If you purchase items for resell and received a 1099k from selling those items where do you report the items initial cost?

Forum|Forum|1 year ago
April 6, 2025
2 replies
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I received a 1099k from my reselling business where do deduct the cost of items sold?

pk12_2

Employee

@polestol assuming that your business is a sole proprietor one , you report the 1099-K, the cost of Goods etc. all on Schedule-C. Note that your net income is subject to SECA Taxes -- Schedule-SE ( equivalent to FICA of wage earners but at the full 15.3% ).

KrisD15

Are you filing Schedule C for the business?

Do you have inventory?

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polestolAuthor

I purchased TurboTax premium following the prompts on schedule C 1099K this is my first year reselling so I had no past inventory and 25K in inventory purchase this year Trying to figure out where I claim that expense

pk12_2

Employee

@polestol if this your first year, then as of Jan 1 your inventory was zero, then as of 12/31/2025 your residual inventory was say $XXX. You bought Inventory $YYY. Thus your COGS should be $YYY LESS $XXX. TurboTax will compute COGS from your entries.

Does this make sense ?