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This information needs to be updated. I just followed the instructions shown immediately below for Option 2, #5. There is no ability to "enter an adjustment to reflect the cost of these items as an offsetting, negative amount up to the amount of the income".
To enter the negative adjustment, follow these instructions:
Go to the Income and Expenses section of TurboTax
- Choose Less Common Income
- Choose Miscellaneous Income, 1099-A, 1099-C
- Choose Other reportable Income
- Enter a description and the amount of your adjustment as a negative number
I received a 1099-K from an online marketplace for $9500 in gross sales of personal property (various things I've had for anywhere from 1-15 years). My cost basis (original purchase price, shipping, fees, etc.) is $5500, so my gains are $4000.
I don't believe I am a business, so should I use Option 2: reporting it via Other Miscellaneous Income to report these gains? My entries would appear as:
Form 1099-K Marketplace Name Personal Property Sales: $9500
Form 1099-K Marketplace Name Cost of Personal Property: —$5500
Alternatively, within the Forms, under Schedule 1, Line 8, item 16a is Taxable Income from Form 1099-K. Upon opening the worksheet, it will calculate the gain and enter that final number. However, I'm concerned that the reported gross number on the 1099-K and my adjustment won't be on the return to show how I came up with that number. Is this still an acceptable method?
To enter your PayPay 1099-K amount and deduct the cost of goods sold, your basis, follow these steps:
This TurboTax Link How do I report a 1099-K if I don’t own a business?
I received a refund from a merchant this year via Paypal and it's over $1k. Paypal categorized it as payments for goods and services and will send me a 1099-k for it.
In this case, how should I enter the 1099-k when filing tax in 2023?
Thanks in advance,
Can someone with TurboTax update this thread with instructions for reporting a 1099-K using the latest (2023) version of TurboTax? I'm trying to report a 1099-K I received from Paypal, and would like to know precisely how to enter the income and costs involved with selling personal items. Thanks
It's not Schedule C it's Schedule D / Form 8949
Loss on Personal Items is not deductible so you have to enter an adjustment to cancel the loss,
or report the cost same as the proceeds.
Gain on Personal Items is a taxable gain.
Use Box Category C/F since you don't have a 1099-B
The proceeds subtotals should add up to your 1099-K
If you use the adjustment (recommended) the adjustment code (Col f) is "L"
I guess I should start a new thread so I can get an answer specific to my request
I added some additional detail on my answer above.
I use Schedule C. I don't have a company so just enter under my name. I have eBay sales - I enter the 1099k amount as income. Enter shipping, fees, and other non-inventory expenses - if there aren't relevant categories, enter as other. you can't show a loss, but you can net 0 - the difference between revenue and the expenses is your cost of goods sold. Your situation may need tweaking, but hopefully this helps.
can you give me a screen shot example of how to do this
Other Taxable Income
Description: 1099-k sale of personal items : 20,000
add another income item:
Description: 1099-K sale of person items : -20,000
total miscellaneous taxable income: 0
No explanation as to what items were sold, when you purchased, when you sold
is this what you mean?
Note - this is a very simplified example of an eBay sale. It is based on the premise that your inventory/purchases cost more than their sale price. For example: I purchased a sweater for $100 last year. This year I sold that sweater for $30 on eBay. I'm not allowed to show a loss, but I can show a net profit of 0.
If the sales price is greater than the purchase price, you need to use the actual cost of purchases and show a profit rather than backing into the cost.
Sched C Line | ||
1099k eBay Sales | $10,000.00 | 1 |
shipping | ($100.00) | 48 |
fees | ($100.00) | 48 |
other expense | ($50.00) | 48 |
gross income | $9,750.00 | |
COGS | ($9,750.00) | 4 |
Net Profit | $0.00 | |
Beginning Inventory | $0.00 | 35 |
Purchases | $9,750.00 | 36 |
Ending Inventory | $0.00 | 41 |
COGS | $9,750.00 | 42 |
I got 1099-K of 20,000 of sales, multiple items about 200. I took a loss on all 200 items.
Where on Turbotax Deluxe do you enter these details? there is a box to enter amount for 1099-K but there is not area to input the details such as description item, date purchased, date sold, cost basis
I believe turbotax premier and higher allows for this but nowhere is there a place in deluxe version.
I was told that you can go to less common income section, miscellaneous income
input description: 1099-K personal item sales, amount of : 20,000
then add another income item: 1099-K personal item sales, amount of : -20,000
total miscellaneous income: 0
hence no tax is generated. however, i believe this might create an audit because there is no information on the items you sold.
there is one area when researching this on internet: information needs to be generated on form 8949
only way I can do this on deluxe is through the stocks, bonds section
last question: do I need to list out all 200 items I sold?
I use the home and business version so can't help with the deluxe version. You don't have to list the sales individually, just the totals. But make sure you keep copies of the eBay statements so you have backup in case you are audited.
IRS would want details on the items you sold however
include dates of purchase and sale, right?
this is what happens step by step in Premier turbo tax but somehow not available in Deluxe
the miscellaneous portion she mentioned in Deluxe might pose questions from the IRS and you might definitely get audited since no details provided
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