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Massachusetts 1099 K eBay Sales with No Original Receipts

Hello! I received a 1099K as I live in Massachusetts and have made more than $600 in sales through eBay last year. I sold personal items, which I have owned for many years. Some sold at a loss, and others at a profit. When you add everything up, I lost money through these transactions. However, I do not have any receipts from when the items were originally purchased, to provide proof that I ended up at a loss. As such, I believe I should not report anything as I ended up at a net loss. Could the state government come back and demand that I pay tax + a penalty because they'll see all these eBay transactions as a profit as I have no proof otherwise? 

Thanks for any advice you may have. 

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1 Best answer

Accepted Solutions
RobertG
Expert Alumni

Massachusetts 1099 K eBay Sales with No Original Receipts

You should report the 1099K sales on your return.  

 

If you are sure you lost money on the sales, enter your cost basis as equal to the sales, so there is no gain or loss.

 

Generally, when you sell used personal items, you sell them for less than you paid.  You can't claim a loss on these sales, because they are personal, and personal losses are nondeductible.

 

You should make a list of what items you sold and what you think you paid for them.  It is very unlikely that you will be audited on something like this, because audits cost the state time and resources.  But if you are, they would probably accept your reconstruction as reasonable.

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1 Reply
RobertG
Expert Alumni

Massachusetts 1099 K eBay Sales with No Original Receipts

You should report the 1099K sales on your return.  

 

If you are sure you lost money on the sales, enter your cost basis as equal to the sales, so there is no gain or loss.

 

Generally, when you sell used personal items, you sell them for less than you paid.  You can't claim a loss on these sales, because they are personal, and personal losses are nondeductible.

 

You should make a list of what items you sold and what you think you paid for them.  It is very unlikely that you will be audited on something like this, because audits cost the state time and resources.  But if you are, they would probably accept your reconstruction as reasonable.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
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