Question

EBAY Form 1099K and Turbotax is so confusing to complete - Please help me.

Forum|Forum|3 years ago
March 19, 2023
3 replies
0 views

Hello,

I have odds and ends at my home to make some extra money and sold them on ebay. The odds and ends in my home I have had for 20+ years and have no receipts. For the most part (about 90%) I have made a profit on the older stuff just knowing I did not pay what i sold the items for. I cannot prove what was the original cost.

I have chosen personal item sales. Then I am asked "Enter the total proceeds for items sold at a loss" with 2 options

a) I sold some items at a loss or had no gain.

b) All items were sold at a loss or had no gain

When I choose option A, I then am prompted with this entry - Enter the total proceeds for items sold at a loss or no gain. Of course, I do not have an exact dollar amount since it's been 20+ years. But in any event, let's say $500 was for a loss. I then run the "smart check" and I get the "check this entry" which says

"Form 1099-B worksheet: Amount from 1099-K has an amount from linked form(s) 1099-K, but the sales proceeds on this worksheet don't match the payment amount from Form 1099-K. Add sale(s) on this worksheet with sale proceeds to match the amount reported on Form 1099-K"

I am then looking at Form 1099-B and see highlighted for Form 1099-K reconciliation with a dollar amount which is $500 less than what the 1099-K (I did state that $500 was a loss). So I have no clue what I should be doing now with this form. Can someone help me - this is driving me nuts.

Thank you!

TurboTax Home & Biz Windows

J

JamesG1

You should be able to view the 1099-B entries on Schedule D in Forms. The proceeds received for the personal items on Schedule D will equal the total of the IRS form 1099-K's that have been entered.

You entered the IRS form 1099-K's and selected Personal item sale.

If so, the entry of the 1099-K has created a worksheet in which you need to enter the personal items, their costs, selling prices, dates and other information.

Each worksheet will generate entries that flow to the Schedule 8949 / Schedule D Capital Gains and Losses.

Table

Description automatically generated

The total of the proceeds column should equal the total of the IRS form 1099-K or the software will give you an out of balance error message.

@Mikster2023

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M

Mikster2023Author

Thank you JamesG1 for your help. Just a few questions if you would be kind enough to answer. So if I have 50 separate transactions that I sold, do I need to list each one individually or can I lump them into one? And am I entering this data on Schedule D (Form 1040) as a "long term capital gain or losses" (since these items are 20+ years old that I have had them) or am I entering these either individually or lumped as one on form 1099-B?

Does Schedule D carry the numbers to 1099-B or vice versa?

Thank you @JamesG1

J

JamesG1

IRS form 1099-B flows to IRS form 8949. IRS form 8949 flows to Schedule D Capital Gains and Losses.

The items may be lumped together but I would report two categories:

personal items sold for less than their basis, and
personal items sold for more than their basis.

Personal items sold for less than their basis (most likely, the original purchase price) report $0 capital gain on line 7 of the Federal 1040 tax return.

Personal items sold for more than their basis report the gain on line 7 of the Federal 1040 tax return. See this example.

Selling Cost

Price Basis

Couch $500 $2,000 Capital loss on personal item = $0 loss

Jewelry $400 $300 Capital gain on personal item = $100 gain

Chair $100 $100 No capital gain or loss

$1,000 $2,400

Table

Description automatically generated

Any loss on the personal items are reported as $0 and the losses may not offset the gains on the personal items.

@Mikster2023

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B

Brama

I ran into this exact same issue. The question "Enter the total proceeds for items sold at a loss" seems to imply that if you enter a number here (which you HAVE to), it assumes you will not enter the itemized entries for which you incurred a loss in the itemization under investments later. If you enter a non-zero amount here, AND also itemize sales for which you incurred a loss, it will raise the 'Check this entry' error because it will deduct the proceeds from losses twice.

And the worst thing is, once you are at the 'check this entry' stage, you are left with no option (assuming turbotax online) other than to delete the whole ebay entry, and re-enter EVERYTHING again. You cannot make corrections without doing this other than, I guess, removing the itemized entries for sales that incurred a loss.

At least this is my conclusion of how it works. This could do with some rework / clarification, it frustrated the ** out of me.

L

LaurieB17

TT does not have to make entering "Income from 1099-K" for EBay items sold so confusing. The question "Enter the total proceeds for items sold at a loss" suggests that you put down the amount you collected for items sold at a loss. However, if you do this you will end up with an error when you do your review because the numbers won't match. I found that the only way to get numbers to match is to enter $0.00 on that question. Later on you can report each item you sold and it will accept your gains and losses there.

Every year I dread doing the 1099K/Ebay section because there are always confusing/ambiguous questions and it is never the same. TT needs to simplify this section!

J

JamesG1

It seems to frustrate some. Perhaps this explanation is helpful.

If you are reporting sales as Personal item sales, you will be reporting the entries on IRS Schedule D.

When you enter the sales information, you will want to click the button to report the loss on sale of a personal item. Personal items sold for less than their basis (most likely, the original purchase price) report $0 capital gain on line 7 of the Federal 1040 tax return.

Personal items sold for more than their basis report the gain on line 7 of the Federal 1040 tax return. See this example.

Selling Cost

Price Basis

T1 $500 $1,000 Capital loss on personal item = $0 gain/loss

T2 $400 $300 Capital gain on personal item = $100 gain

T3 $100 $100 No capital gain or loss = $0 gain/loss

$1,000 $1,400

To report Personal item sales, follow these directions.

Down the left side of the screen, click Federal.
Down the left side of the screen, click Wages & Income.
Scroll down to Other Common Income click on the dropdown menu.
Click to the right of Form 1099-K.
At the screen Did you get a 1099-K?, select Yes.
At the screen How would you like to upload your 1099-K? click Type it in myself.
At the screen Which type of income is your 1099-K for, select the button for Personal item sales. Click Continue.
At the screen Let's get the info from your 1099-K, enter the information.
Box 1a is $1,000 but items T1 and T3 total $600 and report $0 gain.
Click Continue.
At the screen Personal Item Sales, you are told that further information will need to be entered.
Because $600 of the selling price will not be reported, enter $600 under I sold some items at a loss or had no gain.
Learn More provides detailed information for the next steps. Click Continue.
At the screen Your 1099-K summary, notice that the income relates to ‘Personal Items’. Click Done.
At the screen Your income and expenses, scroll down to Investments and Savings (1099-B, 1099-K….). Click Add / Edit to the right.
At this screen, you will be asked to Review the Personal item sales (1099-K). Select Review.
At the screen Now, enter one sale…., answer questions about the personal item sale.
Because you are only reporting the gain transaction, report $400 as Proceeds and $300 as Total amount paid.
Click Continue.
At the screen, Let us know if any of these situations apply to this sale, sales expenses may be recorded.

The entry will be reported:

on Schedule D of the Federal 1040 tax return, and
on line 7 of the Federal 1040 tax return.

Capital loss for a personal item sale reports $0 capital gain on line 7 of the Federal 1040 tax return.

@LaurieB17

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V

Vanessa A

Did you split up the entries for the 1099-K? The error is saying there is a mismatch.

If you only included some of the income, you would need to include the rest so that it matches the 1099-K.

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O

OhioDave111

Yes, I did with three entries for the three different types (or "lots") of stuff (that had a Gain) my spouse sold on eBay.

The 4th type of stuff I did not enter in TT was the Proceeds from items with "no gain or at a loss."

Do I enter that because it almost matches the difference between the red text $4,380 and the amount on 1099-K ($5,751). For some reason, it's exactly $10.00 off (i.e., the $4,380.05 is $10.00 low).

Thanks for the quick reply from yesterday.