Yes, you are correct, you are able to deduct your expenses. It depends on the source you chose for the 1099-K receipts how you will enter the expenses.
Here's how to do this in TurboTax Online if you were selling personal items:
- After completing the 1099-K entry, next navigate to Federal > Wages & Income > Investments and Savings (1099-B, 1099-INT, 1099-DIV, 1099-K, Crypto) > Add/Edit
- Select eBay
- Under proceeds, you will enter the cost of the items with a profit (Total less what you reported did NOT have a profit earlier)
- You will enter the total amount paid, which is your cost of the items
- Continue on and you will be asked if you paid "sales expenses that aren't included in the sale proceeds reported on the form", here you can report shipping.
If the 1099-K was received for a business, you would include the expenses like any other business expense on Schedule C, as well the 1099-K receipts would typically not be reported using the 1099-K entry. Rather, the amounts from 1099-K will already be included in your sales. You can enter the income reported on your Form 1099-K as self-employment income on Schedule C, the same as you would report cash, checks, etc.
See this article for more information: IRS Form 1099-K: What Online Business Owners Should Know
