Do i need to report 1099-k income

[1matsaly]

I sold a personal good (electronics) on a website in 2018. I received payment ($690) for the sale through PayPal. I sold the personal good for less than what I paid for it.

I am not a merchant nor self-employed. 

I'm of the opinion that I do not have to report/enter this 1099-k on my tax return.

Whats your advice?

[KatrinaB]

There is no amount that you are not required to report on your tax return. You should report the 1099-K income on your tax return. The IRS will receive a copy of your Form 1099-K and you may be fined a penalty for not reporting the income.

[BobinCT]

I mostly agree with TTKatrinaB, but if you show it as personal property sold below cost it will not affect your taxes or refund.  If you do not report it then you will probably get a scary letter from the IRS where, by doing more work, you can prove the transaction didn't generate taxable gain.  My preference is to report it and not go through the hassle.

[1matsaly]

I agree in principal that all income is reportable. However I am not sure how to report it. If I were self employed selling it below my cost would result in a net loss.

[1matsaly]

Basically I am asking what is the appropriate tax form to report it (and the loss)? It was a one-time transaction. Do I need to populate a Schedule C?

[BobinCT]

It goes on an 8949.  Hopefully, KatrinaB can give you better guidance than I on how to put that though TurboTax but, basically, it is as a sale of personal property assets (capital gain or loss),, but the loss isn't deductible.

[1matsaly]

Thanks , that is very helpful info. I saw another comment wherein the TT pro said to enter the 1099-K amount as misc other income "sale of personal property" and then go back in and create a second entry with the same dollar amount as a negative value. That must be the TT workaround to both report the income to the IRS whilst avoiding any additional tax liability.