If you have a business, you must report your income on Schedule C. When eBay refers to "200 listings and $20,000 minimum", they are not talking about amounts you need to meet to file a tax return.
Steps to include your income:
- In the Self-Employed Program, go to Income and Expenses and Scroll to the Self-Employment section
- Click Start
- Answer YES to "Did you have any self-employment income or expenses?"
- On the next screen, enter the type of work that you do and press Continue
- Answer the questions on the subsequent screens
- Once you arrive at the summary page, Click "Looks Good".
- Select Form 1099-NEC, new IRS form for nonemployee compensation (replaces 1099-MISC) and Continue
- Answer the questions until you arrive at the "What kind of expenses did you have" screen and choose the expenses that apply to you. If you do not see all the expenses you need, scroll down to the "Less Common Expenses" at the bottom.
Business tax deductions for eBay sellers
The only tax deductions you can use to reduce your gross eBay sales income are those authorized by the IRS, but you'll have quite a few to choose from. Consider whether you qualify for:
- Costs to purchase or fix up the items sold
- Deductions for business use of your vehicle, either actual expenses or the standard mileage rate deduction, 56 cents a mile in 2021
- Advertising expenses
- Apportioned amount of phone and Internet charges related to your eBay business
If you're still unsure if something is deductible, check out a more comprehensive list of common small business expenses.
Please see this LINK for more information.
