Question

Is "hobby income" the same as "hobby profit", meaning gross receipts minus expenses?

Forum|Forum|5 years ago
April 10, 2021
2 replies
0 views

In 2020, I sold used items derived from hobbies (music, numismatics, aquarium, etc.) on ebay and received a 1099-K from Paypal which has a box for gross receipts. However this gross receipts number includes Ebay and Paypal commissions/fees, sales tax paid by buyers which PP retains, cancelled/refunded transactions, Ebay reimbursements due to errors or from taxes I paid on Tax Day, etc. , shipping costs, and market value of the used goods sold. So what do I put in the two boxes provided, "Hobby Income" and "Hobby Expenses" ? If I put gross receipts I can see that I am taxed on the full amount regardless

TurboTax Premier Online

ColeenD3

Prior to 2018, hobby expenses were deductible as itemized deductions on Schedule A. Deductible hobby expenses were limited to the amount of hobby income as a hobby could not create a loss and reduce your taxable income. TurboTax asks this information in case the law changes and allows the deduction again. Entering your expenses does not reduce your tax under current tax law.

B

bool0Author

That's great info. But that does not address my question!

macuser_22

Employee

If you simply sold used items for less than you paid for them then that is not "hobby income". It is just getting some of your money back from what you spent and is not taxable income and does not go on a tax return.

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**

B

bool0Author

I have a combination, I have used items that sold for more and others that sold for less. In the aggregate I made a small profit, under $100. Turbotax has a line labeled "Hobby Income". My specific question is what goes in that line...

macuser_22

Employee

It would only be income if sold for more then you paid for it otherwise it would be a loss that is not deductible.

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**