Form 1099-K for Resellers: What It Means
Got a Form 1099-K from eBay, Poshmark, Mercari, Depop or PayPal, or wondering if you will? Here's what it is, when platforms send one, and why the number on it is usually not what you owe tax on.
What a 1099-K is
A Form 1099-K reports the total payments a marketplace or payment app processed for you in a year. The IRS gets a copy. It's a record of money that passed through, not a bill and not your profit.
When you'll get one
For 2025 and later, marketplaces and payment apps must send a 1099-K when you have more than $20,000 in payments and more than 200 transactions in the year. The planned drop to $600 was cancelled by a 2025 tax law, which restored the $20,000 / 200 rule.
- Some platforms send one below the threshold anyway.
- Some states have lower reporting thresholds, so you may get a state form at lower amounts.
- Not getting a 1099-K doesn't make income tax-free. Profit from reselling is taxable whether or not a form is sent.
Why the 1099-K number is too high
The amount on a 1099-K is gross: everything buyers paid, usually including shipping, and before the platform took its fees. Your taxable profit is much smaller:
Profit = sales − cost of the items you sold − platform fees − shipping you paid − other business expenses
Example. Your 1099-K shows $24,000. Of that, $3,600 was fees and $2,900 was shipping labels. The items you sold cost you $7,500, and you had $2,300 of other expenses (supplies, mileage, subscriptions). Your profit is $7,700, not $24,000.
Selling your own used stuff
Selling personal items for less than you paid (old clothes, a used couch) is generally not taxable income, even if it shows up on a 1099-K. You still need to account for it on your return so the IRS doesn't treat it as profit. Keep a note of what you originally paid. Items you bought specifically to resell are a business, and the profit is taxable.
What to do when the form arrives
- Check the total against the platform's own yearly sales report.
- Download each platform's report of fees and shipping you paid.
- Add up what the items you sold cost you, and your other business expenses.
- Report the business on Schedule C. Give your tax software or preparer the gross amount and your costs, so you're taxed on profit only.
Keeping track as you go is far easier than rebuilding a year in April. See what resellers can write off and self-employment tax for resellers.
Common questions
What is the 1099-K threshold for 2026?
Marketplaces and payment apps must send a Form 1099-K when you have more than $20,000 in payments and more than 200 transactions in the year. A 2025 law restored this threshold for 2025 and later instead of the planned $600.
Do I owe tax on the full amount on my 1099-K?
No. The 1099-K shows gross payments. You're taxed on profit after the cost of items sold, platform fees, shipping and other business expenses.
Do I have to report reselling income if I don't get a 1099-K?
Yes. Taxable income has to be reported whether or not a 1099-K is issued.
Is selling my own used items taxable?
Selling personal items for less than you paid for them is generally not taxable income, but you may still need to show it on your return. Items bought to resell are a business.
For information only, not tax advice. Tax rules depend on your situation and change over time. Check IRS.gov or ask a tax professional before you file. Rates checked October 2026.