I received a 1099K form from Paypal as a result of selling online. I entered it as self-employment income and both federal and state refunds increased. Is this correct?

[jeffptnm]

When I entered the amount as self-employment income (Sched. C), my federal and state refunds actually increased.  Given that I am not required to report this on my federal return (the number of transactions and amount of sales fall below minimum), I don't know if this is correct.  I live in Massachusetts which has lower thresholds but I don't know if this type of income -- just selling some of my used CDs through an online service -- even needs to be reported.

[KarenW]

You should report the income from the 1099K as self-employed income and take whatever expenses you incurred in selling your product.  Since self-employed income is considered earned income and if your income is low and you qualify for Earned Income Credit, you may receive more credits with the added income than without.

[jeffptnm]

Actually, this might have helped had I not sent filed a couple of days ago.  I followed the advice of another Tax Expert.  I reported the 1099K as other income, but did not list expenses because I did not compile a record of them.