Finally selling old inventory

[seeuinhvn]

I started buying years ago items I wanted to resell. I kept receipts by the thousands,  but not track of the items they went with with inventory numbers. I have thousands and thousands of items boxed up. I retired and am selling as a hobby this year, but next year I want to sell over that limit and become a business. My shortcoming is that I don't have inventory bookkeeping for what I sell. I know audits don't happen often. I have receipts from over 13 years ago to now. How do you start the bookkeeping when you're so far behind?  I've done a business short-term once, but didn't use the item cost deduction. Thanks for any advice. 

[smileytown18]

This is why CPAs were created. Call your accountant and ask!
Best of Luck

[ligirl765]

You can create a simple spreadsheet in excel for your list of inventory. Then you can add columns for the dates and sales amount for when you sell something, and anything else you want to track for each item. In a new worksheet in the same file, you can run pivot tables for anything you want to review.

[pink.fish.rule]

And do it while you can still read the receipts. Those CR and CC receipts are thermal and fade over time.

[corvettestainless · Accepted solution]

FYI: there is no 'over the limit' number. If you are selling and making money this year, you need to report it (if you are referring to getting a 1099 from Paypal if over 200 items or $20k in sales)- without a 1099, you still report. 

Best way is to add up all receipts and you have a total. $20k, lets say. End of the year you do an inventory (you may have to 'wing' what things cost, but keep that number- write it on each box or?) and subtract. If you have $10k worth of inventory left, you know you can deduct $10k from your gross sales for the 'cost of items' portion of your deductions. You'll also have ebay fees, paypal fees, shipping costs, shipping materials (if you buy tape, boxes, envelopes etc.) along with some other things that you will want to talk to your tax person about.