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got my PayPal 1099 /// what now?

I assume I owe income tax on any profit I made selling an item, which is probably a loss on most things. Which means I have to show what I paid for the item.

Anybody have any idea on how to go about this. Some things I sold in 2024 I bought over 20 years ago so no way I have proof of purchase. Example.. I sold my 20+ year old Avantgarde Duos for $7K that I paid $10K for.

PLEASE don’t turn this into a PayPal bashing fest or start preaching about the IRS or tell me how stupid I was to use PayPal.

 I am only interested in ideas on dealing with the tax implications

 

thanks

herman
dill
2,545 posts
 

IRS has a $5000.00 threshold for the 2024 tax year.

ozzy's avatar
ozzy
7,545 posts
 

Oh boy I hope I am not screwed. I filed my 2024 Taxes one day before receiving the PayPal 1099K, I really was not expecting any form. So the PayPal amount was never listed on my return.

I thought all I had to do was gather my information in case I was audited. But now I notice the PayPal 1099K amount needed to be listed on the Tax form.

I already filed and it has been accepted by the Fed. When I now throw that amount in it decreases my refund. However, there is a line that can counter that amount to zero.

But as I said I have already filed.

ozzy

carlsbad2's avatar
carlsbad2
1,898 posts
 

@ozzy A copy of the 1099 goes to the IRS.  I would file an amended return, othersize the IRS will have $7k of unresolved income and you will get a letter.  Jerry

ozzy's avatar
ozzy
7,545 posts
 

I agree. I'm trying to figure out how to do that with Turbo Tax.

ozzy

carlsbad2's avatar
carlsbad2
1,898 posts
 

I found the IRS guidance on how to file this 1099-K.  Looks like there is a spot for it on form 1040.  And if you took a loss, you don't get to write it off.  As we thought. 

https://www.irs.gov/businesses/what-to-do-with-form-1099-k#:~:text=On%20Schedule%201%20(Form%201040)%3A,Sold%20at%20a%20Loss%20%2421%2C000%22

 

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