Yes, you will need to enter the 1099-K as the IRS will be expecting it as part of your income. However, after you enter the 1099-K, you will just back the income out since you did not actually make any money.
To enter the 1099-K and then back it the amount (all of it) that was not income, here are the steps in TurboTax Online:
- Within your tax return, navigate to Federal > Wages & Income > Other Common Income > Form 1099-K
- Choose Add a 1099-K
- Enter the information from the 1099-K
- Check the box that says, This amount in box 1a is too high or includes some personal transactions
- Enter the amount that should not be included.
