[ajjohnsonsoxfan]

This happened to me last year and I had to go back and resubmit returns showing COGS and expenses to offset the gains as Paypal only reports total incoming amount of account. The real shitty part is I use my Paypal account for a lot of other things including collecting entrance fees for fantasy baseball, softball dues and various others non hobby related things that have nothing to do with income earned. I had to open another paypal account under my wife's name/info to split up the transactions to fall below the 200/$20,000 threshold