I have a lady that sells ebay items for me, this year, she gave me a 1099misc. I'm in CA how do I enter?

[Sailgirl32]

Hi, I live in CA and received a 1099misc from my ebay lady. It seems like it is personal income but, because I have a schedule c, it wants to think it's a business??? the items I'm selling have NOTHING to do with my business. Please help me!!! It is asking me if it's a qualified business??? Do I call her and ask her? I have no idea.

[DavesNotHere]

**ONLY IF** you truly are not receiving business income from the 1099misc:

Your 1099misc income should be treated as personal (non-business) income and go under the "Part I Additional Income" section at LINE 8 of SCHEDULE 1. There are specific questions in the Step-By-Step wizard that should guide you to the proper place for that, but you can use the FORMS version (and switch back and forth if you like) if the wizard isn't doing what you want.

[DawnC]

What Box is the income in 3 or 7?   Hopefully, it is in Box 3 and 7.  If it is in Box 7, I would have her correct it if it is not business income.   Only income related to your business goes on Schedule C and Box 7.  

And what did you sell on Ebay?  Was it personal items not related to your business?   If you sold personal items for less than what you originally paid for them, you have a loss and the income does not need to be reported and you can delete it.   In this case, you can keep the 1099-MISC with your records and if you are asked about it later, you can explain that this was a sale of personal goods.

If you made money (ordinary gain) of the sale of personal goods, it does need to be reported, but NOT on your Schedule C.   If you need instructions to do this, please advise and I can give you instructions on how to enter it and not link it to your business.  But either way, you should delete the 1099 from your return.   

Do I have to report personal items that I sold?

[Sailgirl32]

Hi, the amount is over 500 but, less than 1000. I gave her personal items to sell for me. Nothing she sold was for more than the value that I paid (and in most cases, nothing sold for more than 50). (I just have a lot of stuff-lol). Somewhere I read that ebay is like selling at a garage sale however, she has an ebay business which is why I received the 1099misc.

[DawnC]

Then delete the 1099-MISC.   You may receive an inquiry later which is likely, so keep detailed records so you can explain later.   List the items and the original amounts you paid so you can clearly show that the income was a loss on the sale of the goods.    

Ebay sales of personal items are the same as having a garage sale and as the link I gave you explains, the income is only taxable if you have a gain on the sale of an item.  But, I can't stress this enough, keep detailed records (purchase price and sales price) of the items.  If you do that, you will not have any tax issues later.