Where do i file the 1099-k in turbotax?

[david9726]

I received a 1099-k from paypal but i am unsure where to enter it's info. I have asked turbotax but they have not been much help they have told me to file it as a hobby or in Schedule C  so i am wondering what others are doing.

BTW i am just a individual on ebay that sells once in a while to help pay for other items such as i sold a PS4 to help pay for a PS5 so i do not see it as income but i will file it, i only sold $2000 worth of items.

Thanks for the help.

[rlauriston]

If it's used personal property you sold at a loss, I don't think you report it on your tax return at all.

You'd report it on Schedule C only if you were in the business of buying and selling stuff to make a profit.

[rfmtm]

@david9726  Currently the IRS is allowing a simplified way to do this when just selling personal or garage sale items not for profit or as a business. You can put the total 1099K amount on form 1040 on the line for Other Income. You then can post an Adjustment up to that total amount to offset that income. This results in a wash (zero profit), you will owe no taxes, and the IRS will be happy.

Any accountant or tax software can guide you through this. 

[mam98031]

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@rlauriston wrote:

If it's used personal property you sold at a loss, I don't think you report it on your tax return at all.

You'd report it on Schedule C only if you were in the business of buying and selling stuff to make a profit.

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That is NOT true.  You may not owe any additional taxes on it, but if you get a 1099K, you need to represent it on your tax returns or IRS will be asking why it wasn't included at some date in the future.

[mam98031]

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@rfmtm wrote:

@david9726  Currently the IRS is allowing a simplified way to do this when just selling personal or garage sale items not for profit or as a business. You can put the total 1099K amount on form 1040 on the line for Other Income. You then can post an Adjustment up to that total amount to offset that income. This results in a wash (zero profit), you will owe no taxes, and the IRS will be happy.

Any accountant or tax software can guide you through this. 

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Even though the amount on the 1099K is NOT your Gross Income amount?  

@rfmtm 

[espresso_warehouse]

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@mam98031 wrote:

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@rlauriston wrote:

If it's used personal property you sold at a loss, I don't think you report it on your tax return at all.

You'd report it on Schedule C only if you were in the business of buying and selling stuff to make a profit.

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That is NOT true.  You may not owe any additional taxes on it, but if you get a 1099K, you need to represent it on your tax returns or IRS will be asking why it wasn't included at some date in the future.

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Absolutely. Don't leave out any income, ever. 1099 or not. It's not worth having to refile or deal with some letter later.

[johnrj1226]

 You say you loose money when  you sell some thing based on what you  original paid for it but now you say you don't expect it to hold it its value  - these are to contradictory statements.  

A used item does not hold it original value but  it's  value is based on condition and what a willing person might willingly pay pay for it (i.e. fair market residual value).  You can find that out on eBay or similar sites) by searching the sold items.   I  drive a a 2011 Chevy Impala and I certainly can't sell it  today for the price I paid for it  11 years ago.   When you drive a new car off the lot  less than  2 miles it has already consider a used vehicle and has lost about 10% of the price you paid for it.  A home will "usually" appreciate in value  over time.  But that has not always been true.   In 1973 -1975 home prices stagnated (recession). In 1984 due to  high interest rates and a big  recession many home were upside down when the oil bust happened in Texas, Oklahoma, New Mexico, Louisiana and  the same thing happened in the recession of   2007/2008.   This  can happen again.

What  is the current  value of a PS4 today, tech stuff looses value as new tech makes things obsolete.   That's how these tech companies make a killing by "planned obsolescence - 'cause some folks just 'gotta have the latest and greatest to show off to their friends & neighbors.

[johnrj1226]

One more thing  around 2007 I bought a  37 " Vizio flat screen TV for  $747  out the door.  Today one can buy a new one for  less than 200  bucks for a 40" screen same make.  My  Vizio is still working just fine  probably  worth zero or 25 bucks  at a garage sale but I ain't going to replace unless it dies.

[espresso_warehouse]

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@johnrj1226 wrote:

What  is the current  value of a PS4 today, tech stuff looses value as new tech makes things obsolete.   That's how these tech companies make a killing by "planned obsolescence - 'cause some folks just 'gotta have the latest and greatest to show off to their friends & neighbors.

How is this supposed to help someone asking a tax question?

[johnrj1226]

You read  it context of the entire  post including  my one more thing comment vs  being  one of these

 CIAO!

[dbfolks166mt]

     I am not that familiar with Turbotax but the H&R Block software walks you through the process as you are entering your income sources. It simply asks if you received a 1099-K, you input the amount and proceed through the software where you input the expenses that get transposed to the schedule C. 

[rfmtm]

@mam98031  The Other Income line is for the total of any income not accounted for elsewhere on your return.  If I remember tax programs like TurboTax opens a worksheet window to list miscellaneous income items and there also will be a place to enter any Adjustments to offset this income.  Note that you can not claim a loss using this method.

The other way to claim the ebay income for only personal garage sales items is on Schedule "D".  However, this is much more complicated for just a small occasional seller, although certainly should be used if income and expenses are significant, or you are already required to use Schedule "D" for other reporting.

Otherwise, if you operate as a business buying and selling for profit, then of course you need to use Schedule "C".

[mam98031]

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@rfmtm wrote:

@mam98031  The Other Income line is for the total of any income not accounted for elsewhere on your return.  If I remember tax programs like TurboTax opens a worksheet window to list miscellaneous income items and there also will be a place to enter any Adjustments to offset this income.  Note that you can not claim a loss using this method.

The other way to claim the ebay income for only personal garage sales items is on Schedule "D".  However, this is much more complicated for just a small occasional seller, although certainly should be used if income and expenses are significant, or you are already required to use Schedule "D" for other reporting.

Otherwise, if you operate as a business buying and selling for profit, then of course you need to use Schedule "C".

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Still I'm not sure that is the proper place for the numbers represented on a 1099K since it is NOT reporting income.

[rfmtm]

@mam98031 

Where you enter the amount in TurboTax for Form 1099-K depends on what you received it for.

If your Form 1099-K is for self-employment or business on a Schedule C, enter the income along with your other business income.

If your Form 1099-K is for rental income (not common), enter this income along with your other rental income.

If your Form 1099-K is for casual personal item sales and is not a business or even a hobby, like selling on ebay enter the income in TurboTax by going to Misc/Other Income and select the last option.  Enter the description as income from 1099-K and the amount.  You also will want to enter an Adjustment to offset this income, assuming all was sold at no profit.

I haven't received my new TurboTax, but there is instructions on doing the above.  If you let TurboTax guide you, it will direct you where to enter the amount, if you answer "yes" to receiving any 1099K.

[mam98031]

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@rfmtm wrote:

@mam98031 

Where you enter the amount in TurboTax for Form 1099-K depends on what you received it for.

If your Form 1099-K is for self-employment or business on a Schedule C, enter the income along with your other business income.

If your Form 1099-K is for rental income (not common), enter this income along with your other rental income.

If your Form 1099-K is for casual personal item sales and is not a business or even a hobby, like selling on ebay enter the income in TurboTax by going to Misc/Other Income and select the last option.  Enter the description as income from 1099-K and the amount.  You also will want to enter an Adjustment to offset this income, assuming all was sold at no profit.

I haven't received my new TurboTax, but there is instructions on doing the above.  If you let TurboTax guide you, it will direct you where to enter the amount, if you answer "yes" to receiving any 1099K.

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Yes, the 1099K is for anything that was paid to your via a MarketPlace with their own money processing system and / or any money processor like Paypal, Stripe, etc.

So that could cover many types of businesses that are not even related to Ebay or any other marketplace.

And yes there are a variety of ways that different types of income is reported on your Federal Income tax report.  

For Rental income it is Schedule E.

Personal property belongs on the Capital Gains form [schedule D].  And then if it is a gain, you report it on the 1040 on the appropriate line.  But if it is a loss, you are not allowed to take the loss.

Yes programs like Turbo Tax are very helpful and beneficial.  We use one every year.

[rfmtm]

Yes, technically you should use Schedule "D", but the IRS and TurboTax note it is not a problem to just report it as Misc/Other Income, so why not keep it simple, if you can.  Bottom line is, as long as you have accounted for the income, the IRS will be happy.