3/18/2024 Tax reporting for $580 in net profits from personal items

[kak4815]

I sell my personal items at a loss, documented by receipts. I sell the items that I'm no longer using; all of them have depreciated in value. I file online with H&R Block; I'm in the US. According to the My eBay>My Account>Seller Dashboard, near the bottom of the page, my gross sales were $580.98. According to the Account>Payment Information>Payments>Payouts page, the net profit from the sales was $412.92. That's a difference of $168.06. That means I've got to deduct:
1. The shipping and handling
2. Sales tax (this is where things get really complicated)
3. eBay's take
4. Foreign country sales taxes
5. The original purchase price of the items
6. Fees charged by eBay
I've got to scrape together that data from the tax invoice pdfs and csv files, and the financial reports. Possibly the listings' pages, too. Am I on the right track? 

[albertabrightalberta]

Correction to your post: 

The amount on the 1099K doesn't include sales tax. Although buyers paid it and you paid FVF on it, it's taken right back and ebay forwards it to buyers' states. 

[ebooksdiva]

eBay has devised a great form that is easy to use during tax time it is  Reports you can find in under the Payments tab in your Seller hub. 

The report has all info on your Orders, Refunds, Expenses (eBay fees includes promotions, shipping labels) Net transfers (Payouts). 

[richard1rst]

---

@kak4815 wrote:

I sell my personal items at a loss, documented by receipts. I sell the items that I'm no longer using; all of them have depreciated in value. I file online with H&R Block; I'm in the US. According to the My eBay>My Account>Seller Dashboard, near the bottom of the page, my gross sales were $580.98. According to the Account>Payment Information>Payments>Payouts page, the net profit from the sales was $412.92. That's a difference of $168.06. That means I've got to deduct:
1. The shipping and handling
2. Sales tax (this is where things get really complicated)
3. eBay's take
4. Foreign country sales taxes
5. The original purchase price of the items
6. Fees charged by eBay
I've got to scrape together that data from the tax invoice pdfs and csv files, and the financial reports. Possibly the listings' pages, too. Am I on the right track? 

---

At the risk of seeming picky, but please understand that the proper terminology is extremely important. You DID NOT make a net profit of $580.98. You had a net cash receipt of $580.98. But receipts are not equal to profit. After you deduct the items you detailed then and only then, do you have net profit or loss.

If those numbers throw you into a loss then you can quit there. BUT you missed some.

If you use your car to bring the packages to the post office you can get a gas or mileage deduction (your choice) for that.

The cost of any boxes, tapes, padding material and printer ink are deductible

Any sales taxes you paid in relation to your eBay activity are deductible.

[dbfolks166mt]

     If you are using the H&R Block software, which I also use, as you go through the filing process the software will actually ask you for those numbers, along with other deductions. These are essentially plugged into a Schedule C tax form to get to the bottom line net gain or loss. The following IRS publication may help you with some details on deductions. 

https://www.irs.gov/pub/irs-pdf/i1040sc.pdf 

     If you operate at a loss that loss may help offset your other tax liabilities but the IRS has constraints on how long you can do this and under what circumstances. 

[luckythewinner]

I've got to deduct:
1. The shipping and handling

If you use eBay labels and print the eBay transaction report, every label will be listed. Just total them up - for tax purposes there is no need to attribute it to a specific sale. 

2. Sales tax (this is where things get really complicated)

You should not be reporting the sales tax that eBay collects and remits to the states, because you did not receive that money.  

3. eBay's take

If you print the eBay transaction report, every label will be listed. Just total them up - for tax purposes there is no need to attribute it to a specific sale. 

4. Foreign country sales taxes

You should not be reporting the sales tax that eBay collects and remits to the states, because you did not receive that money.  

5. The original purchase price of the items

eBay cannot help you with that. You just have to keep track of it yourself. 

6. Fees charged by eBay

This sounds like a repeat of (3) above. 

Am I on the right track?

Don't forget the cost of packing materials. 

[kak4815]

I didn't make enough in sales to qualify for a 1099K to be sent to me, unfortunately. I think the minimum is at least $600 for 2023. For 2024, it's going up to something way higher, like $10k or $20k. 

[kak4815]

The webpage I'm looking at looks different. Following "payments"> "Reports and taxes", there is a link to monthly "Financial Statements" which doesn't allow a custom time range. Each month has a "Summary" pdf and a "Full Statement" pdf. No csv files are available, unfortunately. The "Tax Invoices" link has "Summary" and "Detail download" csv files.

The "Form 1099-K" link says "You’ll get a Form 1099-K if your sales meet the minimum IRS reporting threshold in a calendar year" and says "You don't have any 1099-K tax forms available." So, unfortunately, I don't qualify for eBay gathering the information into one document for me.

[nobody*s_perfect]

---

@kak4815 wrote: ... . I think the minimum is at least $600 for 2023. For 2024, it's going up to something way higher, like $10k or $20k. 

---

The federal threshold for 2023 was $20,000 and 200 transactions, but there are several states that have set lower thresholds, mostly $600.

The threshold for 2024 has not been set yet, but the IRS has proposed a threshold of $5,000 in this memo:

The IRS has decided to stick with the $20,000 threshold for another year. Here's their official announcement:

https://www.irs.gov/newsroom/irs-announces-delay-in-form-1099-k-reporting-threshold-for-third-party-...

[mam98031]

---

@kak4815 wrote:

I didn't make enough in sales to qualify for a 1099K to be sent to me, unfortunately. I think the minimum is at least $600 for 2023. For 2024, it's going up to something way higher, like $10k or $20k. 

---

You wouldn't qualify for a 1099K for 2023 as the threshold is $20,000 and 200 transactions.  IRS has said they are considering the 2024 threshold to be $5,000, but they have not yet confirmed that.

What state are you in?  That matters because there are a handful of states that have their own requirements for 1099K to be issues and some are much lower than the IRS threshold is for 2023.