Does anyone know if Square fees are considered part of my business expenses? I use Square for in-person craft fairs sometimes and they take a percentage of each sale.

Great question about handling mixed purchases! You're absolutely right to include the proportional shipping and tax costs along with the base price of your business items. Here's a simple way to think about it: if your business supplies made up 60% of the total merchandise cost in an order, then 60% of the shipping and tax should also be counted as business expenses. So if you bought $30 in chains and charms plus $20 in personal items (total $50), and shipping was $5 with $3 tax, then your business expense would be: $30 + (60% × $5) + (60% × $3) = $30 + $3 + $1.80 = $34.80. I'd recommend setting up a simple system now while your business is small - maybe a dedicated spreadsheet or even just a notebook where you track each purchase with columns for date, vendor, total cost, business portion, and calculated business expense. Also consider getting a separate credit card just for business purchases to make year-end calculations easier. One more tip: don't forget you can also deduct things like the percentage of your internet bill used for business, mileage to buy supplies or ship orders, and if you have a dedicated workspace at home, potentially some home office expenses. The IRS has great resources on their website about Schedule C deductions that are worth checking out!

Has anyone had success using the "garage sale rule" with the IRS? I've read that they generally consider occasional sales of personal items like a garage sale, even when done online, and don't expect you to report those sales if they're at a loss?

I'm in a similar boat - selling old furniture and electronics to help with bills. One thing that's helped me feel more confident is keeping a simple spreadsheet with what I'm selling, the sale price, and my best estimate of what I originally paid (even if I don't have receipts). For items where I really can't remember the original price, I've been looking up similar items online to get a reasonable estimate of what they would have cost when new. The key is being reasonable and honest - the IRS isn't expecting perfect records for personal items you bought years ago. Also, don't stress too much about the PayPal vs eBay threshold differences. Even if you do get a 1099-K, it's just a reporting document - it doesn't automatically mean you owe taxes on money you didn't actually profit from. The important thing is that you can show these were personal items sold at a loss when you file your return. Keep good records of what you're doing now, and you'll be fine even if you cross whatever threshold ends up applying this year.

Does anyone know how detailed we need to be with the expenses? Like do I need to list every single item I sold with its original cost, or can I just put a total amount that covers everything?

This is such a frustrating situation that so many of us are dealing with now! I went through the exact same thing last year when I sold some old furniture and electronics during my move. The 1099-K made it look like I had all this "income" when I actually lost money on everything. One thing that really helped me was creating a simple spreadsheet to track everything. I made columns for: item description, estimated original purchase price, sale price, and sale date. For items where I couldn't remember the exact original price, I researched what similar items cost new around the time I would have bought them. The key is being reasonable with your estimates. If you sold a laptop for $300 that you bought 3 years ago, look up what that model cost new back then - it was probably $800-1000. Document your research process too (like "checked Best Buy archives" or "found similar listing on eBay sold listings"). Also, don't stress too much about having perfect receipts for everything. The IRS understands that people don't keep receipts for personal items forever. Just be honest, reasonable, and keep good records of how you arrived at your cost estimates.

TurboTax won't always let you e-file a 1040-X even if it's just Schedule D changes. It depends on the specific situation and tax year. I tried to e-file an amendment for my 2019 taxes (in 2022) and the system forced me to paper file because of some limitation with Schedule D amendments for that specific tax year. But when I did a 2020 amendment with Schedule D changes, it let me e-file with no problem.

I just went through this exact situation last month! Had to amend my 2023 return for some incorrect cost basis reporting on Schedule D. TurboTax handled it perfectly through their amendment workflow. The key thing is to make sure you use TurboTax's "Amend a Return" feature rather than trying to create a new return. It will pull up your original return, let you make the Schedule D corrections, and then generate a proper 1040-X that only includes the changed information. When I e-filed mine, the IRS only received the 1040-X form and the corrected Schedule D - no other unnecessary forms. The whole process took about 10 weeks to get processed, which seems pretty standard based on what others have mentioned here. One heads up though - TurboTax will charge you an additional fee for the amendment (I think it was around $40-50), but honestly it was worth it for the peace of mind knowing everything was filed correctly electronically.

Just a warning - I tried something similar and it came back to bite me. My ex signed Form 8332 and I claimed our son, but when she applied for some income-based assistance later that year, they noticed the discrepancy with the support order. She got denied benefits initially, and then the child support office reviewed my payments and found I was paying based on the agreement that I wouldn't claim kids. They retroactively increased my support for that year and I had to pay the difference plus 6% interest. Not worth it in my experience.

This is exactly why I always recommend getting professional help with situations like this. The intersection of family law and tax law can be incredibly complex, and making the wrong move can have serious financial consequences that last for years. From what I'm seeing in the responses here, it sounds like your child support agreement likely creates a binding legal obligation that supersedes what Form 8332 might allow from a purely tax perspective. The IRS form handles the tax side, but it doesn't override court orders or legal agreements you've made. Before you do anything, I'd strongly suggest: 1. Get a copy of your complete child support order and read every word carefully 2. Consider consulting with a family law attorney who can review the specific language 3. If you and your ex both want to change the arrangement, explore doing it properly through the court system The tax benefit might seem appealing now, but based on what others have shared, the potential consequences (retroactive support adjustments, interest, legal complications) could far outweigh any short-term savings. Better to spend a little money upfront on proper legal advice than deal with expensive problems later.