JamesG1
Expert Alumni

Deductions & credits

If you are reporting sales as personal item sales, you will be reporting the entries on IRS Schedule D.

 

I suspect that you have reported the IRS form 1099-k income, but now need to report the sales proceeds and personal item cost on Schedule D under Investments and Savings.

 

When you enter the sales information, you will want to click the button to report the loss on sale of a personal item.  Personal items sold for less than their basis (most likely, the original purchase price) report $0 capital gain on line 7 of the Federal 1040 tax return.

 

Personal items sold for more than their basis report the gain on line 7 of the Federal 1040 tax return.  See this example.

 

                           Selling           Cost

                           Price              Basis

 

Tix 1                   $500              $1,000        Capital loss on personal item = $0 gain/loss

Tix 2                   $400               $300          Capital gain on personal item = $100 gain

Tix 3                   $100               $100          No capital gain or loss              = $0 gain/loss

 

                            $1,000           $1,400

 

To report Personal item sales, follow these directions.

 

  • Down the left side of the screen, click on Tax Home.
  • Click on the down arrow to the right of Review.
  • Click on the blue band labeled Review.
  • Down the left side of the screen, click Federal.
  • Down the left side of the screen, click Wages & Income.
  • Scroll down to Other Common Income click on the dropdown menu.
  • Click Start to the right of Form 1099-K.
  • At the screen Did you get a 1099-K?, select Yes.
  • At the screen How would you like to upload your 1099-K? click Type it in myself
  • At the screen Which type of income is your 1099-K for, select the button for Personal item sales.  Click Continue.
  • At the screen Let's get the info from your 1099-K, enter the information.      Click Continue.
  • At the screen Personal Item Sales, you are told that further information will need to be entered.
  • Because $600 of the selling price will not be reported, enter $600 under I sold some items at a loss or had no gain
  • Learn More provides detailed information for the next steps.  Click Continue.
  • At the screen Your 1099-K summary, notice that the income relates to ‘Personal Items’.  Click Done.
  • At the screen Your income and expenses, scroll down to Investments and Savings (1099-B, 1099-K….).  Click Add/Edit.
  • At this screen, you will be asked to Review the Personal item sales (1099-K).  Select Review.
  • At the screen Now, enter one sale…., answer questions about the personal item sale.  
  • Because you are only reporting the gain transaction, report  $400 as Proceeds and $300 as Total amount paid.
  • Click Continue.
  • At the screen, Let us know if any of these situations apply to this sale, sales expenses may be recorded that are identified in your spreadsheet.

The entry will be reported:

 

  • on Schedule D of the Federal 1040 tax return, and 
  • on line 7 of the Federal 1040 tax return.

Capital loss for a personal item sale reports $0 capital gain on line 7 of the Federal 1040 tax return.

 

 

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@cw4754 

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