Regarding eBay 1099-K

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Some confusion regarding eBay 1099-K, If I sold personal items only all at a loss, do I have to individual list those transactions one by one on the 1099-B worksheet or can I just check the 2b box under 1099-K Reconciliation?

Ask the Experts - Deciphering - Feb 2025

MindyBAnswer

Level 13

You don't need to enter the items individually if you sold them all at a loss. You also do not need to fill out a 1099-B. I advise you to delete what you entered in the 1099-K entry, self-employment, and investment entry if they appear.

Here is how to report personal items sold with no gain in TurboTax Online:

Within your tax return, go to the magnifying glass icon on the top right, type 1099-K and select the Jump to 1099-K link in the search results
Choose Add a 1099-K
The next screen will ask "Which type of income your 1099-K is for?" choose Personal item sales, then Continue
Enter the information from your 1099-K
After you choose continue, the next screen will show "Personal Item Sales". Here is where you choose "All items were sold at a loss or had no gain"

MindyBAnswer

Level 13

Here is how to report personal items sold with no gain in TurboTax Online:

Within your tax return, go to the magnifying glass icon on the top right, type 1099-K and select the Jump to 1099-K link in the search results
Choose Add a 1099-K
The next screen will ask "Which type of income your 1099-K is for?" choose Personal item sales, then Continue
Enter the information from your 1099-K
After you choose continue, the next screen will show "Personal Item Sales". Here is where you choose "All items were sold at a loss or had no gain"

Maverick_25Author

Level 2

The confusion is that TurboTax 2024 doesn't report this on Schedule 1 (Form 1040) lines 8z and 24z, nor does it create a form 8949. The only document that is created is Form 1099-K Summary when you print your return.

This seems at odds with the IRS reporting requirements.

Please advise.

IRS page: https://www.irs.gov/businesses/what-to-do-with-form-1099-k

Personal items sold at a loss

A loss on the sale of a personal item can't be deducted from your taxes. But you can zero out the reported gross income so you don't pay taxes on it.

If you sold personal items at a loss, you have 2 options to report the loss:

Report on Schedule 1 (Form 1040)

You can report and then zero out the Form 1099-K gross payment amount on Schedule 1 (Form 1040), Additional Income and Adjustments to Income PDF.

Example: You receive a Form 1099-K that includes the sale of your car online for $21,000, which is less than you paid for it.

On Schedule 1 (Form 1040):

Enter the Form 1099-K gross payment amount (Box 1a) on Part I – Line 8z – Other Income: "Form 1099-K Personal Item Sold at a Loss, $21,000"
Offset the Form 1099-K gross payment amount (Box 1a) on Part II – Line 24z – Other Adjustments: "Form 1099-K Personal Item Sold at a Loss $21,000"

These 2 entries result in a $0 net effect on your adjusted gross income (AGI).