I would like to add that when I compare these options using another tax reporting software, I see that I can file it as Schedule C if we are small business (which we aren't). OR I can file it under MISC / hobby. If I expand that info, I get something along the following
"Tell us here the gross income you have from a business or investment if you don't run it to make a profit.".
I feel the important take away from that is report income from a business that you don't run to make a profit. That absolutely is our case. My wife is just selling something to turn around a buy something else. She just wants to keep the flow going to enjoy the process of shopping and socialising online with others, i.e. a hobby.
Additionally, If I look up YARD SALE, under another services HELP section, I get the following that states garage sales are informal, private sales of used personal goods. This is absolutely our situation. She is not buying new items at cost to then make a profit. She is buying "yard sale items used" and then selling them shortly after once the novelty wears off. Nor is she's trying to "Flip" items for profit. The service says that yard sale items are not usually taxable. But does acknowledge the occasional item that is considered "collectable" and has an increased value. This is the crux of the problem with these new 1099-K reporting requirements that have started this year as there are a lot of sellers that are essentially online garage sales. It feels like the IRS wanting 1099-K data from online merchants like PayPal makes sense in trying to account for those online businesses that truly exist to make a profit. However, the new changes seem to be now catching all the online yard sellers that are not running a business but are only selling off used goods, usually at a loss in regards to initial cost.
Garage Sales
An informal, private sale of used personal goods.
Receipts from garage sales usually aren't taxable. However, they can be in very unusual cases where you sell an item for more than you paid for it.
