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Old 01-29-2013, 11:25 PM   #68 (permalink)
HoustonCPA
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Join Date: Aug 2012
Posts: 75
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Quote:
My main transactions are for group breaks and I do not profit on my breaks as others do.
The safe bet is to report your income as usual and report the expenses on either Schedule C (if treating it as a business) or on Schedule A (if treating it as a hobby). The better answer would be to consult your tax adviser. Technically, if you are hosting breaks where you do not make profit, such as through the Blowout forum rules, you are not in the business of making money. If you host enough breaks to meet the Paypal 1099 requirement, it would be worth the extra expense to find a local CPA to walk you through the proper steps to ensure your maximum deduction.

Quote:
Almost all my transactions are from hosting, or joining others breaks. My year end statement shows an $8,000 loss.
Unless you sold the cards from your "joining other breaks," those expenses are not deductible even though they appear on your Paypal statement. That statement is similar to a bank statement, it just shows all activity coming in and going out of your Paypal account, and not necessarily your tax deductible expenses.

Quote:
I buy Bowman Jumbo box at $125.00 and sell a rare rc auto for $50.00. I have to give the cost of card sold at only .26 (12 packs ber box 32 cards per pack brings 384 cards $100/384=.26 per card). This would show a profit (prior to fees and expenses) of $49.74. While the rest of the 383 cards from the box would be worth $10.00 and still in my inventory would that make that profit on the one card accurate?

How do I account of the rest of the cards as most likely I would never sell them.
Depending on how you valued the cards, yes; there is another example in this thread (I think at the bottom of page 1 or top of page 2). The other cards could not be deducted if you do not sell them. As a very simple example, if this was a business, the leftover cards would remain in your inventory until you sold the company and would never hit the income statement. How it balances out in the end, is that if you later decided to sell your business, your appraised value would include those cards sitting in your inventory. At the conclusion of the sale, you would recognize a gain or loss that would put you back at even. Again, this is a very simplistic example and assumes a lot.
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