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Old 04-14-2011, 11:40 PM   #1
clark153
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What Schedule C category to use for eBay fees

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2010 was the first year for our eBay business. We have over $100,000 in sales in 2010. I have got most everything figured out for our taxes except the category for eBay fees. We are planning on putting Pay Pal fees under line 10, "Commissions and fees".

Is the best place for Pay Pal fees and should eBay fees also go there? It seems logical since eBay's fee is based on value and is like a commission.

Thanks!
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Old 04-17-2011, 12:50 PM   #2
Juno
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“We are planning on putting Pay Pal fees under line 10, "Commissions and fees". “Is the best place for Pay Pal fees and should eBay fees also go there? It seems logical since eBay's fee is based on value and is like a commission.”--->Yes I guess so. You need to report amounts for commissions and fees paid for your EBay services rendered in the production of your profits. Ebay income is treated like any other self-employment income. As self employers, you need to use Schedule C of 1040 so that operating e expenses like inventory, fees, utilities and rent can be deducted from that income to define a net profit, which is considered taxable income to be reported on Sch C and Sch SE as long as the amount on Sch SE line is $400 or exceeds $400 and you need to pay your Self-employment tax,13.3% for 20110, NOT 15.3%.
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