Originally Posted by momosgarage
Thanks for recapping this point.
But for the other item where someone cleans house one time on ebay and has $20,000+ gross sales.
You essentially are saying, as long as its a one time thing on a single return (not multi year) a person can file the proceeds of the sale on a schedule C as "personal property" without any recipts or proof of such?
If you are able to prove it's personal property and you file your schedule C with the 1099 reported by paypal and give the explanation why it's different, theoretically
yes taht is correct. I'm not coming out and saying the IRS won't penalize you because I am not going to go on record saying they won't. Personal property is not a taxable transaction, but the burden of proof is on you to prove it was personal property. If you prove that, then yes your assessment would be correct.
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