Do I need to report my small eBay sales income if no 1099 was issued?

Do you have to file a Schedule C even for such a small amount? I thought there was a $400 threshold for self-employment taxes?

You're thinking of self-employment tax, which kicks in when your net earnings are $400 or more. Since the profit here is $1050, it's above that threshold, so yes, Schedule C is required. You're right that there are thresholds, but they apply to the taxes owed, not the reporting requirement. All income technically needs to be reported regardless of amount. The $400 threshold is specifically for when you need to pay self-employment tax (Social Security and Medicare).

Does it work for other platforms like Mercari or Poshmark? I sell on multiple sites and get really confused about tracking everything.

I'm skeptical about these tax tools. How does it actually handle the documentation part? I never know if I'm keeping the right records.

It definitely works for Mercari and Poshmark too! I actually used it for my Poshmark sales as well. It helps you combine all your selling platforms into one report so you're not trying to file separate schedules for each platform. As for documentation, it gives you a clear checklist of what records to keep and for how long. For online sales, it recommends screenshots of your sales reports, purchase receipts (if you have them), shipping costs, and platform fees. It even creates a simple spreadsheet template you can use to track everything going forward.

Wait, is this for real? I thought getting through to the IRS was basically impossible these days. How much does something like this cost?

Sounds like a scam to me. The IRS barely answers their own phones, why would they answer for some third party service?

It's definitely real! The service doesn't actually change anything about the IRS answering - they just handle the hold time for you. They use an automated system to wait in the phone queue, and when an actual IRS agent picks up, they connect the call to your phone. They don't get special treatment from the IRS - they're just taking over the most frustrating part (the endless waiting and menu navigation). I was super skeptical too until I tried it. You actually talk directly to the same IRS agents you would if you called yourself, but without having to wait on hold for hours.

Can you still claim Cost of Goods Sold if the items weren't originally purchased for resale? Like if they were personal collectibles I bought years ago for my own enjoyment?

Yes, you can still claim Cost of Goods Sold for personal items you later decided to sell. The IRS doesn't require that you intended to resell them when you first purchased them. What matters is that you have a reasonable basis for determining their cost. If you don't have the original receipts, you can use fair market value at the time you acquired them (based on research of similar items from that time period). Just document how you arrived at those values in case you're ever questioned.

The $600 threshold got delayed again. For 2023 (filing in 2024), the threshold is still $20,000 AND 200 transactions. The $600 threshold is supposed to kick in for 2024 (filing in 2025), but who knows if they'll delay it again.

This is super helpful, thanks for sharing your experience! The spreadsheet idea is brilliant - I've been trying to track everything in my head which is clearly not working. Quick question about the research for missing receipts: did you just look up completed eBay listings from around the time you originally bought the items, or did you use other sources too? I'm worried about being able to justify my estimates if the IRS ever asks.

For my missing receipts research, I used multiple sources to build a solid case: eBay completed listings (using the "sold" filter and searching by date ranges), PriceCharting.com for video game values, and even Amazon price history tools like CamelCamelCamel. I also checked hobby forums and price guides that were popular when I originally made the purchases. The key is being consistent and reasonable - don't lowball everything to minimize taxes, but don't inflate values either. I created a simple document explaining my methodology: "For items purchased 2019-2021 without receipts, I researched average sold prices on eBay during the original purchase timeframe, cross-referenced with hobby price guides, and used conservative estimates." I've never been audited, but my tax preparer said this level of documentation would be more than sufficient if questioned. The IRS understands that people don't always keep receipts for personal items they later decide to sell.

This is really reassuring to hear from someone who's been through the same process! I'm definitely feeling less overwhelmed after reading everyone's advice here. The spreadsheet idea seems to be a recurring theme - I'm going to start one right away for tracking everything going forward. Quick question about the self-employment tax calculation - when you say about 15.3% on the $1050 profit, does that mean I'd owe around $160 in self-employment tax plus whatever my regular income tax rate would be on that amount? I'm trying to set aside the right amount so I'm not scrambling at filing time. Also, did you run into any issues with TurboTax when you entered your sales without a 1099? I'm worried the software might flag it as an error or something.

Yes, you're calculating correctly! The self-employment tax is 15.3% on your net profit ($1050), so about $161, plus regular income tax at your marginal rate on that same $1050. So if you're in the 22% bracket, you'd owe roughly $161 + $231 = $392 total on that income. TurboTax handled it perfectly fine without a 1099. The software is designed for this exact situation - lots of people have self-employment income without receiving tax forms. When you get to the business income section, there's usually a question like "Did you receive a 1099?" and you just select "No" and continue entering your income and expenses manually. No flags or errors at all. One tip: TurboTax will automatically calculate and include the self-employment tax when you complete Schedule C, so you don't have to worry about figuring that part out separately. The software handles all the calculations once you input your sales and expenses.

This is exactly the kind of detailed, practical advice I needed to see! As someone just starting to navigate this whole online selling tax situation, I really appreciate you sharing your experience with the coin sales. The research methodology approach for missing receipts is particularly helpful - I've been stressing about not having perfect documentation for everything, but it sounds like reasonable estimates backed by research are totally acceptable. Did you create any kind of written document explaining your research process, or did you just keep notes for your own records? Also, I'm curious about the timing aspect - when you say you researched what similar items sold for during the timeframe you originally purchased them, how specific did you get? Like if you bought something in 2019, did you try to narrow it down to a specific month or quarter, or was "2019 pricing" general enough? Thanks for taking the time to break this down so clearly - it's making the whole process feel much more manageable!

Great question! For the research documentation, I created a simple one-page summary explaining my methodology that I kept with my tax records. Nothing fancy - just a document titled "Cost Basis Research for eBay Sales 2023" that outlined my approach: "For collectible coins purchased between 2018-2021 without receipts, I researched historical pricing using PCGS price guides, Heritage Auctions completed sales, and eBay sold listings from the original purchase timeframes." For timing, I tried to be as specific as reasonably possible. If I knew I bought something in "early 2019," I'd search eBay sold listings for January-March 2019 and take an average of similar condition items. For purchases where I only remembered the year, I'd research pricing from that entire year and use conservative estimates (meaning I didn't cherry-pick the lowest prices, but chose realistic middle-ground values). The key is being consistent and reasonable. My tax preparer said the IRS cares more about good faith efforts and logical methodology than perfect precision. As long as you're not obviously trying to minimize taxes through unrealistic estimates, they understand that personal items sold years later won't have perfect documentation.