Two 1099-K / Schedule C questions...

[danny1376]

1. Does the 1a figure on my 1099-K ("Gross amount of payment...") include the taxes and fees collected by eBay? I assume it does NOT, because on eBay account's of my 2022 report, if I subtract the "Taxes and fees" number from the "Total sales" number, I get a number that is CLOSE to the "Gross amount of payment" on my 1099-K. I assume the slight discrepancy between the numbers is due to New Year's Eve sales whose transactions didn't clear till the next year, or something like that. In other words, I can NOT deduct the "Taxes and fees Collected by eBay" figure on my Schedule C, because this amount does NOT contribute to the "Gross amount of payment" on my 1099-K. Right?

2. Does this 1a figure on my 1099-K include refunds I've given? Or do I need to go through my account figures in eBay to find out how much to subtract for refunds given?

[slippinjimmy]

@danny1376 

Sales Tax collected by eBay is NOT included

Refunds you have made are NOT included

The number on the 1099 include every penny that has been processed through your account, the total amount paid to you for items+shipping, it's up to you to make adjustments for any and all expenses and refunds.

You can use a Transaction report to find the info you need as that report includes every single in/out transaction.

[dhbookds]

If you go to Payments reports (new)......put in the dates for last year........it gives you individual totals of fees/refunds, shipping, etc......

[sapphire_studio]

You're still going to have to write off your eBay fees from that number and your shipping costs but not the sales tax that eBay collected that you never saw.

[danny1376]

Great, I think that makes sense to me.

So when filling out the Schedule C, I can just go with the 1099-K "Gross amount..." number and not even worry about  the "Total sales" number on my internal eBay report. The "Taxes and fees Collected by eBay" figure is NOT included in the 1099-K anyway.

I'll have to go into my eBay account and find the 2022 refund total and subtract that from the gross on the Schedule C. (Looks like refunds would go on line 2, and then subtract that from the gross on line 1...).

Thanks again for your help, and thanks for anyone else who might chime in. I'm basically thinking out loud here and I fill out the Schedule C for the first time.

[danny1376]

Right, yes, I understand that. Looks like the "Selling costs" figure on the eBay report is what I subtract. I've tentatively put that number down as part of "Commissions and fees" on Part II line 10 of the Schedule C...

[danny1376]

Yes, makes sense. I'm kind of an old pro at going through my eBay reports, but this is the first time I'm doing a Schedule C.

Thanks to everyone here. I really appreciate it and I'm sure a lot of other sellers will also.

[nobody*s_perfect]

Just to be clear: The total on your 1099-K includes all of the funds that eBay processed for you, for item price and shipping and handling. Sales tax is not included in that total.  eBay does not subtract any refunds that you gave to buyers so those are a deductible expense.  Here's the eBay Help page about 1099-K:

 https://www.ebay.com/help/selling/fees-credits-invoices/ebay-form-1099k?id=4794

[slippinjimmy]

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@danny1376 wrote:

Great, I think that makes sense to me.

So when filling out the Schedule C, I can just go with the 1099-K "Gross amount..." number and not even worry about  the "Total sales" number on my internal eBay report. The "Taxes and fees Collected by eBay" figure is NOT included in the 1099-K anyway.

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Yes and no, the 1099K numbers are based on Payout date while most of the other numbers you will have are based on sale/payment date.

Your reported numbers do not have to be an exact match to the 1099 but they do need to be in the ballpark.

[nobody*s_perfect]

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@slippinjimmy wrote: ... the 1099K numbers are based on Payout date while most of the other numbers you will have are based on sale/payment date....

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From the Help page linked above: "As Form 1099-K is an IRS information return, it includes the gross amount of all reportable payment transactions within a calendar year, based on when funds settle to eBay, not necessarily when funds are received by sellers"...

[johnrj1226]

The  "Taxes and fees Collected by eBay" figure is NOT included in the 1099-K anyway."??

The fees that eBay collects comes out of the  the amount  your customer paid for the item -  you deduct those on you schedule C.  Same goes for the shipping/handling the customer paid.  If you offered "free shipping"  those costs should be in your item price.  That gross revenue is in the 1099 K - if not eBay blew it.

When you say Taxes - I,m assumming you  mean the Sales Tax the customer paid if so you are correct.

[monica-sells]

https://www.ebay.com/sh/fin/reportslanding

this report should be very close to your 1099-K numbers

It shows Orders/Refunds/Expenses/Net Transfer

all available in a .csv download for details

just set your time period and go

[caldreamer]

1099 "gross income" (purchase + shipping income).   Sales tax NOT included.    1099 does NOT deduct refunds (you do that on Schedule C).    If you print 2 EBAY reports (below) this will provide all necessary information for filing taxes.  

1. MONTHLY TAX INVOICE print all 12 months (shows TOTAL EBAY FEES PAID (including FVF + store fees).  
2. Go to PAYMENTS, REPORTS, REPORTS (NEW) enter time period 1/1/2022   12/31/2022

**** Only use EBAY FEES shown on MONTHLY TAX REPORT (other EBAY report is inaccurate….does NOT include STORE FEES.

GROSS INCOME minus (Returns, Shipping Expense, Other Expenses) = NET SALES (taxable amount)

[slippinjimmy]

@nobody*s_perfect 

In eBay speak the "settlement date" is the date the Payout is initiated but NOT necessarily the date the seller would receive it in their bank account.

[dbfolks166mt]

GROSS INCOME minus (Returns, Shipping Expense, Other Expenses) = NET SALES (taxable amount)

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     What you described gives you your eBay net not the taxable amount unless you are generalizing "other expenses" to include shipping supplies POV, COGS, ink, paper...................... that will generally be greater than your eBay fees and expenses.