So, you sold some personal items and received payment through an app? Now you received a 1099-K and don't know what to do with it? We can help!
Items Sold at a Gain
A gain made on the sale of a personal item is taxable.
If you receive a Form 1099-K for a personal item sold at a gain, report it as follows:
- Federal Section
- Income
- Select My Forms
- Investments
- Stocks, Mutual Funds, Cryptocurrency, Collectibles, etc.
- Enter sales one by one
- Report the sale by entering the information requested
Items Sold at a Loss
A loss on the sale of personal items is not deductible. If you received a 1099-K for personal items sold at a loss, you are still required to report the 1099-K. However, you can offset the income for this sale.
Example: You receive a Form 1099-K for selling your dining room table online for $750. You paid $1,250 for it. You cannot claim the loss but can offset the income by following these steps:
Reporting the income:
Follow these steps within our program to report the income.
- Federal Section
- Income
- Select My Forms
- Less common Income
- Other Income Not Reported Elsewhere
- Choose Other Income
- Enter the description of the income (why are you deducting it) as "Form 1099-K personal item sold at a loss, $XXX" and include the dollar amount.
- Enter the amount of the income you are reporting from Form 1099-K
- Continue to save your entry
Subtracting the Income:
Subtracting the income will be a duplicate entry with a small change.
If you are reporting the subtraction immediately after making the income entry, select '+Add an Other Income Item' and continue with steps 7-9. Otherwise, follow the steps below to make your subtraction.
- Federal Section
- Deductions
- Adjustments to Income
- Other Adjustments
- Other Adjustments Not Listed Above
- Enter the Description as 1099-K received in error
- Enter the amount that should not be considered income on the 1099-K
Additional Information
For additional information on 1099-K reporting, please visit our Knowledgebase