Can I report 1099K from PayPal as personal, not business?

[markwentworth195]

Hi. I stopped doing business in 2015 (antique sales, eBay and elsewhere.) I neglected to change my Paypal account from business to personal. This year I sold 2 personal items on eBay ($700 total), and now have a 1099k from Paypal. Can I report this form as personal income? TurboTax tells me that the income should have already be reported as business income. Thanks!

[IreneS · Accepted solution]

Yes, since you are no longer in business you can report the income as Miscellaneous Income using these steps:

1. Click on Federal > Wages & Income   
2. In the Less Common Income section , click on the Start/Update box next to Miscellaneous Income, 1099-A, 1099-C.  
3. On the Miscellaneous Income screen, click on the Start/Revisit box next to Other reportable income.  
4. On the Any Other Taxable Income? screen, click the Yes box.
5. Enter the income on the Other Taxable Income screen, along with a description.  Click Continue. 
6. You will be brought to the Other Miscellaneous Income Summary.  If you have no more miscellaneous income to report, click Done.

[Edited | 4/8/2020 |  11:37am PDT]

[Deholz]

That’s great for reporting the gross payments processed by PayPal, but certainly the original posted didn’t “net” $700. Where would he note his expenses for the sale of the two items (ie: value of the items, eBay fees, PayPal fees, etc). 

otherwise, isn’t he being taxed on the gross proceeds and not the net?

seems a schedule c might be required to offset expenses of those sales.