Business & farm

It depends. The IRS in its publication  says you can report the 1099K information in one of two ways.  I'd recommend the first method. 

• Report the payment on your tax return at the top of Schedule 1 (Form 1040) PDF. This will ensure you don’t pay taxes you don't owe; or
• Report the loss on Form 8949, Sales and Other Dispositions of Capital Assets, which carries to Schedule D, Capital Gains and Losses.

Here is how to report the first method in TurboTax.

1. Report the 1099K under the other common income section of the return.
2. When it asks you for the type of income, be sure to enter Personal Use Items.
3. Then the next screen will ask you for information on the form.
4. Next screen you can check that the items were sold at a loss and had no gain. The income becomes nontaxable at this point.

As an FYI, losses on personal items can't be claimed but can be zeroed out to exclude the gross income reported on the return. Also, if the entry is zeroed out, it won't appear on Schedule 1 but there will be a 1099K worksheet included in your return that reports the details on the 1099K.