This question might be a little complex and unusual, so I hope someone knows what I am talking about and can help me.
I review products through a program called Amazon Vine. The value of the product is considered income. When doing taxes, my understanding is, I need to enter to 1099-NEC that Amazon sends me as self-employment income. Then if I sell that item for that amount or less then it is not considered more income. I would only need to report any profit I make over the cost basis.
The question I have is related to the selling of the items at a flea market. Amazon Vine makes us wait 6 months to sell the item. Legally, the items belongs to us right away since it is our income. But to stay in the program and keep getting items, they want us to wait for 6 months before selling. So at that point, if I decided to sell these items at my flea market booth where I would be taking payments with Square, then Square is going to send me a 1099-K for sales made at the flea market. This gets tricky thought because any of the items sold that are Vine items have already been reported as income. Selling these items just converts them to cash from product.
So let's say I sell a $100 item I got from Vine. This shows on my 1099-NEC as $100 income. After my 6 months time then I put it in the flea market and put $50 on it. I have a loss and am not supposed to have to report this at all because I did not profit and therefore did not receive additional income. But the customer pays with a card and Square sends a 1099-K showing $50. It looks like I have a total of $150 income from this one product when I really have a $50 loss. So, how do I account for that to make sure I am not paying taxes twice? I mostly want to sell some of these items to try to save for the taxes I have to pay since they consider the item value as income even though there was no $ involved.
Thanks.
