I was working untill May of 2019. But became unemployed after from may 2019, since my only son died by self inflicting gun shots.
I always try to make some extra income by using my hobbies of collecting coins and sell them on ebay. Since i became unemployed i have recived more than $22000.00 through paypal by selling my collections of coins on ebay..
Usually i keep my sales below $10000
So I do I am missing lots of my purchase records that i collected prior to 2018. Sometimes I bought bulk items and And some items I sold on ebay for $10 or $15 $25 or $50 dollars which i bought in bulk items. So those items do not have any individual purchase records. So how can i file those individual sales, if i bought them in bulk quantities. ?
So i realy do not have an idea how to file my taxes this year. How can i file my 1099 if i do not have necessary purchase records ? Please kindly help . Thanks.
I am so sorry about the loss of your son, it is devastating to lose a child.
First of all, identify the cost basis for the pieces that you know. For bulk items, where you sold them all, allocate the cost to each one. And for the rest of them, apply Cohan's Rule of Allocation as listed below:
A common law rule whereby taxpayers, when unable to produce records of actual expenditures, may rely on reasonable estimates provided there is some factual basis for it. "Absolute certainty in such matters is usually impossible and is not necessary; the Board should make as close an approximation as it can, bearing heavily if it chooses upon the taxpayer whose inexactitude is of his own making." See Cohan v. Commissioner, 39 F. 2d 540 (2d Cir. 1930).
Here is IRS Publication 551 for more information.
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