Selling on eBay for business, how do you account for inventories bought many years ago?

Forum|Forum|11 months ago
April 10, 2025
1 reply
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Let's say I''ve been regularly selling on eBay as a reseller and been reporting this business on Sch C. If I decide to sell bunch of items that I have bought several years ago that were originally meant for a personal use, how should I account for their cost basis? They were originally bought for a personal use, so their cost of goods was never entered into Sch C. But Sch C. only seems to be able to enter cost of goods bought in the most recent year(2024). If I bought items back in 2015~2022 and sold for a profit, where can I enter the cost basis on Turbotax?

Thank you.

Not A Product Question

JohnB5677

You would post it to 2024.

It was essentially gifted to the business in 2024.

Use the original cost basis if you sell it for more than the original basis.
Use the selling price as the basis if you sell it for less than the original basis
However, use the fair market value at the time of the gift if you sell it for less than that value.

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oboero2Author

Thank you for your reply, I just have few more questions if you could help me.

1. So it would just go under "cost of purchases" under 2024, right?

2. Since you mentioned that it was essentially a "gift," would I need to file some kind of gift tax form once the amount goes over $18,000 (which is the 2024 annual gift tax limit)?

Thank you.