Understanding Summary - are returns included as profit in gross sales summary

[stardust100_0]

For tax purposes , are returns included  in the one page summary gross sales “as profit”  or does eBay deduct them and not include in the gross sales number ? Thank you. 

[caldreamer]

Yes, return merchandise is included in "gross sales".    EBAY has easy to read 1-page report that shows YTD totals for (orders, returns, EBAY fees, shipping expense).   When filing your Federal income tax...you report the "gross sales/orders" (as shown on report) and then subtract expenses.

ORDERS

- Returns

- EBAY fees

- Shipping expense

- Other expenses (mileage, packing supplies, cost of goods)

NET SALES (taxable amount)

[stardust100_0]

Thank you very much

[mam98031]

It is important to know the differences in terms.  For example on the 1099K, the number they report is the Gross Receipts.  That means the total money that came into your Managed payment account BEFORE any deductions for Returns, shipping or Fees.  After you subtract those, you arrive at your Gross Income.  From that number you subtract your product costs, office expenses, shipping supplies, etc.  To then arrive at your Net taxable income amount.

Ebay can't calculate your "profit" because they don't know all your costs of sale.