Entering information from a 1099K for selling on Poshmark. How do I enter this?

[BrittanyS]

The sales from Poshmark would be reported on Schedule C, Business Profit, and Loss.  You will report your total gross income on the Schedule C; then, you can reduce it by subtracting the amounts you spent for allowable expenses.  

To enter into TurboTax, follow these steps:

1. Click on Wage and Income on the left-hand side of the screen
2. Scroll down to Self-Employment, click show more
3. Click start beside Self-employment income and expenses
4. Click Yes for Did you have any self-employment income and expenses
5. Enter your self-employment work
6. Answer interview questions about the business
7. Select Form 1099-K to enter payments received

For more information on Self-employed businesses, see the links below:

Schedule C

Business-related Expenses

[eriksjensen]

For this year, according to this IRS document, it looks like this does not need to be filed? I am not sure?

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

[DianeW777]

Yes, it must be included in your tax return. 

The IRS link simply means that Poshmark or other third party settlement organization (TPSO), if the money goes through a third party, is not required to issue a Form 1099-K for 2022, if the sales did not exceed $20,000 and/or 200 transactions.

They may have filed one for you because this law was put in place to submit them once the amount exceeded $600, and then was delayed until 2023.  Either way, the income must be reported.

To record the Form 1099-K on your tax return depends on what type of merchandise you sold.  Also, you must decide if it's a business or if it was simply a sale of personal items.

Sale of Personal Items (not in business for profit):

An item or group of items in one transaction sold at a gain is a taxable gain.  An item or group of items in one transaction sold at a loss, the loss is not deductible. These are reported on Schedule D.

Sale of items for to make a profit - business or hobby:  

You can decide if it is hobby or business income.  This IRS link will help you: Business or Hobby?

Key elements:

1. A hobby requires you to report the income you received and under the current tax law, Tax Cuts and Jobs Act (TCJA), no expenses are allowed to be used to reduce the money collected even if you itemize deductions.
2. A business allows you to deduct the costs necessary to obtain the income.  The law explains that 'you must be engaged in the activity to produce a profit'.  The test under IRS tax law is that you must show a profit three out of every five consecutive years to be considered a business.

Once you decide what type of income this is you can use the links below to see how to report.

• How do I report hobby income?
• Where do I enter Schedule C

Our wonderful Tax Expert @BrittanyS has laid out the steps for the Schedule C entry as well.

@eriksjensen