Do NOT trust any answer you get on line. I am not a CPA or attorney. That said, keep track of all of your costs and subtract them from your income. You will have to pay taxes on any profit generated.

Search on eBay for Cliff Ennico's books: The eBay Seller's Tax and Legal Answer Book and The eBay Business Answer Book. He covers the topics you are inquiring about. Mr. Ennico has presented at eBay Live in the past and I heard him at eBay On Location this year.

Find a CPA and Attorney that will back up what they tell you if the IRS or California qustion your tax return.

I just love how I have to keep track of every little penny. I love having a partner (IRS). I find or consign the items. I store them I inventory them, I take pictures. I do all the work to list them. I take them to the post office. I spend gas money mailing money packing materials envelopes and all that it takes to run an ebay business. THEN....... My partner who hasn't lifted a finger to help me, makes me do all his paper work just to tell him what his share is. If I don't pay him he will break my back and put me out of business. I really don't need a partner.

If you have tons of time (and i mean TONS) then I think you can handle it. Otherwise Don't. There are great books available to purchase  as posted previously.  Whether you havve time or not YOU NEED TO READ the book by ENNICO. Also go to the IRS site on the web. They have a specific area for Ebay and Online sellers. The reading is intense and there is lots of it.  If you feel comfortable

after reading page after page then i'm sure you can manage.
You can also contact the IRS directly and ask them
to clarify something or ask them a direct question. They
are very helpful.  (make sure you get the persons name).
Let them be your CPA. Its free.

They talk about the home deduction also which is a must.
If your business model is more complicated  then maybe you should seek advise from a CPA, but it helps to know what
your CPA is doing.  I got audited one time when I used
a CPA and it wasn't pleasant so I do it myself now.
NO ONE CARES  about YOU more than YOU.  Get help from a CPA or IRS but don't leave yourself in the dark. Know whats going on.

$20K is a lot for liquidating stuff around the house-- not sure the IRS would buy it.  You should check with a tax preparer. Here's my take on it.

When you sell your used property, you're selling a capital asset. Generally, you're selling it at a loss-- your cost basis, or what you paid for it, is higher than the amount you sold it for.  So it's a capital loss, not income. But it's not a capital loss that's deductible against income.

So-- if you're really not in business, you don't need a Schedule C, and you don't need to report the amount from the PayPal 1099 as income.  Take a look at the instructions for Schedule D, which address the issue of the sale of personal assets, and in particular, the instructions for form 8949, where you can report the sale of personal capital assets.

For those filing Schedule C who have some personal (non-business) sales included in their 1099, consider deducting them out on line 2 (Returns, adjustments, allowances), and attaching a statement explaining.

That said, I'd repeat my suggestion to get professional advice from a tax preparer.

A great start would be removing Socialist Obama--then you get the liberal big spending liberals pigs out of the senate..You have to start somewhere--this is where I start..This 1099k crap, I invested in a bunch of collectables years ago and paid top dollar--now I am just getting rid of the crap and taking a huge loss..When you take the paypal fee's and ebay fees off it is even worse..Now that I see it on paper,I am going to stop right now--If you take a huge loss on your sales, are you still expected to pay taxes on it?? Obama has done a real number on small business owners and it will shut down thousands of jobs and companies..This country is changing for the real worse and something needs to be done real fast...If I like the Euro-trash way of living I would move to France, or if I like seeing Mosques on every block I guess I would move to the middle east..Why is this crap being rammed down my throat?

HI,

I am currently selling some of my "Capital Assets" . Some items I had them for many years. Therefore, I do not have the receipt anymore. Any guideline on how to handle it?

Thanks,

If you are a business then add up all the expenses (including mileage but not time) and take that away from what you made.

If you are not a business any one item that sold at a profit is taxable regardless if you lost money on the rest.

If you need to find out what something cost that you no longer have a receipt for try what the MSRP was, googling, pulling old bank statements or credit card statements.

I have a background in accounting: Have volunteered with the IRS and submitted taxes for low income yearly in a program called VITA. I've also organized my father's taxes for his manufacturing business. 

I will give everyone the best advice if your sales to a certain state such as California and Virginia my state which required the same thing over 10 years ago. Here is the 411, when it comes towards any state that demands sales taxes and your a business you must per your states law it varies file for a state sales tax certificate if you sale to residents in your own state.

Now if your out of the state of California or Virginia which both demand sales taxes on mail-order and internet sales then the sales tax is the responsible reporting to the buyer when they file their income taxes. That being said there is and exception, if your business generates more that a set amount sales annually you must collect and pay those sales taxes it's roughly $50,000 per year to a state that requires sales tax and you only do that volume such as the state of Virginia. California has their set amount --- why do you want to ensure you track and pay those sales one phrase that will cost you more "Aiding and Abiding tax evasion" if they are desperate for the money plus any penalties which will increase expense pay them. 

I can't afford the software to do so! 

I got news my friends congress has two bills in house they want to require eCommerce tax nationally - I've fought with a .org and here is the solution - on google  type in "TaxCloud" it's not approved for Ebay users yet but do send message with ebay to use them.

It's a tax eCommerce software for eCommerce small business sellers and it's Free - a requirement as many states are following suit with Virginia and California..they are supported via Govt' grants and donations- take a look we all worked hard various businesses and tax savvy volunteers - to aid the upstart/ home worker, small business trying to just make ends meet- the service is in three headquarters meaning three back up servers so if the east coast is down you have back-up in west coast or mid-east - they calculate taxes based off of zip codes so they can even calculate jurisdictional or municipal tax figures that may apply in some regions of California and yes this software is approved by the sales tax governing board that works with various states - all free unlike the big box retailers you don't have to pay thousands of dollars in this service.......

Please check it out - now there are other eCommerce tax efficient software but those are based on sales volume once you go over the standard rate can be thousands per year and expense we shouldn't have to bare - I do this for a living finding resources for the struggling start-up so if you only do what permits you to be a participant SBA  for valid assistance this is your software and you can inquire and request upon your investigation for ebay offer this service to us small sellers.

Cassie L. Wilkerson

Circassian Projects Limited (Richmond, Virginia)

Cassie Wilkerson Circassian Projects Limited

Okay this is eBay I will give you insight for free have an associate in accounting here is a link on my store 

http://members.ebay.com/ws/eBayISAPI.dll?ViewUserPage&userid=circassian-2012

Here is why you want to look at the Philco 1942 Radio I'm selling I've listed in the description the original selling price in 1942- most items are sold are used - they depreciate average and disposed but we have buyers in nostalgia and collectors. Do not list worth point or base selling price - there are terms in account - cost of goods sold - meaning the original cost you paid to attain those assets - you don't have a receipt no problem in describing look up rough age when sold and google for collectors who are experts some have blogs that will give original sales price and identifiers some have even interviewed guys that originally made the items on the assembly line or more die-hard fans. The post this info free cause they have a passion. why do you want to get the lowest original price - left over inventory at end of the year the IRS check ebay for what you listed and have not sold - there is an assessed tax on items unsold - only if your a business. Not a business just an occasional seller don't worry about it but rough estimates you should access based of age and average selling prices at the time - ideal is 5% to 35% of your sell price and yes must deduct selling expense mailing supplies, shipping costs and etc. there are great softwares that work such as intuit that will help but you should know your original selling price for break even and establish accelerated increased value ratio as pending volume of sales and if applicable state taxes their may be an investment tax applied only again only to business usually auction houses and antiques dealers - best find a good business accountant secured not a franchise but an independent as hint - as a business tax expenses are deduction off your taxes  - take care 

Cassie L. Wilkerson 

Circassian Projects Limited ( Richmond, Va) 

P.S. if your doing under $50,000 in sales you should depending region pay only $300- $600 in professional accountant fees and look for ones that also can represent you legally in tax court .. title is esq. and have freebies or reduced services for personal investment services, and notary republic services a really good accounting firm is recommended with any small business remember you can deduct the expense on your taxes regular tax payers can't! 

Cassie Wilkerson Circassian Projects Limited

Anyone would know what kind of personal tax software to use for sellers to keep track of sales, $ spent, $ fees spent,  $ losses? I am a new bie, I am not a powerseller.

But smallestcararbet, according to our Dear Leader, you didn't build that. You should be happy the Govt allows you to keep some of their money. I'm with ya 100%!!!!

it organizes

there is a free version that just does 3 months

there are categories for everything  mileage supplies office supples advertisint (auctiva falls under this)

you can also manually add transactions that are not traced in ebay

it created a Schedule C worksheet that I took with me to HR Block, I also printed the other stuff out just in case.  She said all she needed was the worksheet, if the IRS had any questions they would contact me (which she assured me they would not)

Outright suggests that you download it all on a zip drive and take it with you to wherever you get your taxes done.