1099k for selling old clothing

[az148]

Hello, there is a lot of discussion around this but different answers so I'm more confused now. If I received a 1099-k from ebay/poshmark since I crossed the $600 threshold (crossed it by maybe $10) - how do I write it off so that it is not taxable since Im just selling old textbooks/clothing for less than the original value that I bought it for? I don't have all the receipts since some stuff are years old and I doubt all us casual sellers keep receipts for used clothing. I've heard some advice to either file a Schedule D or Schedule C - which one do I file? Some say to list it as other income on Schedule 1, but I don't that's correct b/c everything on Schedule 1 is taxable. Can someone point me in the right direction?

[rjs]

No one can point you in the right direction because no one knows what the right direction is. The IRS has not issued any useful guidance for such situations. Any advice that you see is simply someone's best guess about what the IRS is going to do.

Here is what the IRS has said.

Understanding Your Form 1099-K

Form 1099-K Frequently Asked Questions: Individuals

[NCperson]

@rjs - late breaking news - today, the IRS just delayed implemtation for a year !

@az148 

https://www.irs.gov/newsroom/irs-announces-delay-for-implementation-of-600-reporting-threshold-for-t...

[rjs]

Late Friday night (after the posts above) the IRS issued revised instructions for Form 1040 with new instructions for reporting the sale of personal items at a loss. Of course, since the IRS just issued this late Friday, TurboTax has not yet implemented the new IRS instructions. That's going to take a while. So just wait and don't worry about it.

Basically the IRS instructions are to report the 1099-K income as other income on Schedule 1 line 8z, with an offsetting adjustment on Schedule 1 line 24z. The description for both entries would be "Form 1099-K Personal Item Sold at a Loss."

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@az148 wrote:

Some say to list it as other income on Schedule 1, but I don't that's correct b/c everything on Schedule 1 is taxable.

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Only the things in Part I of Schedule 1 are taxable. The Adjustments to Income in Part II of Schedule 1 reduce your AGI and your taxable income.