I started selling on ebay, will I have to pay taxes on my sales at tax time?

[Opus 17]

Mostly yes, but it depends on a number of factors.  In general, you pay income tax on your profit, or net income.  But determining that can be challenging, and you will need to keep really good records.

To start with, are you only selling your own used items?  Or will you be buying and reselling inventory?  Will you have a couple of sales a year, or will this be an ongoing business activity with an intent to make a profit?

[SweetieJean]

A Tax Filing Factsheet for eBay Sellers - TurboTax Tax Tips & Videos (intuit.com)

[Sweetpeas48048]

I will be buying and reselling, continually

[Sweetpeas48048]

I will be buying and selling so far I'm having sales everyday continually and consistently

[unclecrusty1]

I sold some of my own personal musical gear on Reverb.com that I no longer use, and got a 1099-k for $1725. How do I file this?

[DaveF1006]

If you received a 1099F, you will need to report this on your return

1. Sign in to TurboTax and open your return
2. Go to federal>wages and income>other common income>income from form 1099K
3. Select Yes on the Did you get a 1099-K? screen
4. Select Hobby, Personal item sales, Personal Property Rental, or Other, and then select Continue
5. Enter your 1099-K information

If you are using TurboTax Online, check the box under 1a and enter the amount not subject to tax (personal items you sold at a loss, gifts, and reimbursements).

If you are using TurboTax Desktop:

• If you selected Hobby income or Personal Property Rental, you are done
• If you selected Personal item sales, you will need to choose if everything was sold at a loss or if some items were sold at a loss (you will then need to enter the gain)

@unclecrusty1 

[Opus 17]

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@unclecrusty1 wrote:

I sold some of my own personal musical gear on Reverb.com that I no longer use, and got a 1099-k for $1725. How do I file this?

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If you sold the items for less than your original purchase price, and you did not claim them as business tax deductions, then the proceeds are not taxable, but you need to report the 1099 so the IRS sees it on your return.

If you sold any items for more than you paid, the difference is taxable income. 

If you used the items in a business and took a business expense deduction for the purchase price, the proceeds are taxable and should be reported as business income (using the procedure to dispose of a business asset by selling it.)