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Question about taxes on internet auction sales

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T

Trmpetyjo

Guest
I live in Michigan,
I have had a hobby of buying baseball cards for the past ten years. Last year I purchased a lot of baseball cards with my credit cards. I also sold some of them on popular auction websites to pay some of the debt off. I live at home with my family still and have no other bills besides my credit cards. Do I have to file taxes as a business? I know I have charged more debt than I have made profit. Any information on this will help
Thanks , Josh
 


L

loku

Guest
Unless your sales were fairly extensive, and you do intend to make an ongoing business of such sales, the gain from selling the cards is capital gain. Such gain is taxable and if you meet the requirements for filing a return, you must report the gain. In each case the gain will be the sales price less the cost of the cards sold and less any expenses you incur in the sale.
 

JETX

Senior Member
You asked, "Do I have to file taxes as a business?"

The answer... not unless you ARE a business.

Assuming that these are 'casual' sales (and not done extensively under a business name), then these are considered personal sales. As such, you're to show them on your personal tax filing (not business). This is done by simply tracking the cost and the subsequent sale price, then reporting the 'profit' on your taxes as miscellaneous income. It is then taxed at the 'normal' individual rate. Depending on the actual amount reported, the 'damage' (additional tax liability) could be from nothing to substantial.
 

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