January 1 could be interesting thanks to congress.

[BobC]

Adam, and others, are on the money. We've talked about this before, and my fingers have come close to falling off with all the typing I've done in answering questions for people about taxes and the potential implications they may face. just look at the thread Brian (the OP) linked to in the opening post.

To directly respond to Brian/OP, even if you don't have a receipt for an item(s) you sell that gets reported to you on one of these 1099-K forms for this past year, you still want to at least reasonably estimate what you paid for the item and show it as a deduct against the price you got from selling it, and thus properly determine if you had net income/capital gain, or a net loss/capital loss, from the sale. As Adam/Exhibitman stated, the IRS is not completely unreasonable, and they realize you must have paid something for the item you sold. If you do the best you can to at least reasonably try and remember and report what you may have paid for things you bought for cash years ago, most IRS agents will give you some benefit of the doubt and work with you. But that would only come into play if the IRS came back and actually wanted to audit your card sales reported on your tax return. And the chances of someone just doing some side sales, and not really a full-time card dealer, being audited are really remote. That is as long as you remember to not ignore these 1099-K forms you may now get, and be sure to properly report them on your tax return. Failing to report them on your tax return, or screwing up how and/or improperly reporting your sales activity on your return, are what will get you noticed by the IRS, and significantly increase your chances of actually being audited by them and maybe needing that supporting documentation you may not have 100% of.

And don't forget, just because you get a 1099-K form reporting sales you made during the year, that doesn't automatically mean you are in an actual business and have to report and file your card sales on federal Schedule C - "Profit or Loss From Business". I've said this numerous times on the forum now, for people who buy and sell cards you can actually end up being treated as one of three different and distinct types of taxpayers in that regard. You can be treated/taxed as a collector/hobbyist, as an investor, or as a seller/dealer actually in business. And honestly, to be even potentially more confusing, you can actually be more than just one single type of taxpayer in regard to selling cards, all at the same time. You can be a dealer who has inventory that you sell as a business, then a personal collection you keep for yourself, along with another group of cards/items that you acquired strictly for long-term investment purposes. The trick is to segregate the cards that fall into each of these different areas/categories, and be sure to properly document and record which is which if ever asked and you have to prove it to an IRS agent.

Rather than going into this in more detail, I've already written numerous posts on this and other related tax topics and issues here on Net54. Best thing to do is to go to the search function, look under Advanced Search, and type in my handle, BobC, and look for any posts I've made. Then just peruse the list of threads that come up and look for those that look like they may have something to do with taxes (sales, income, etc.) or reporting (1099s, IRS, etc.). Even some of the threads about "vaults" delved into tax implications and issues. Then just look through them for my posts. Not necessarily the most efficient way to go back and read a lot of what I've said already in regard to our hobby and taxes, but the best I can do. Wish there was a simple/easy way I could go back and somehow accumulate all my tax related posts in one place that people could then use as a resource. Or, just ask direct/specific questions on here or through PMs even. Have had several people doing that as well. There are also some other tax/CPA people on the forum that can feel free to chime in.

As always, if you are uncertain or uncomfortable with what you may need to do in regard to your taxes when it comes to your hobby/dealer activity, I've always advised talking to a local, qualified, tax professional for assistance and advice. Every single person/taxpayer's tax situation is going to be unique, and I am giving a lot of more generalized information. Still hope this helps.