Guide
Reseller taxes and the 1099-K
This guide is general information for U.S. resellers, not tax advice. For your situation, talk to a tax professional.
When you get a 1099-K
Marketplaces and payment apps send a Form 1099-K when your payments pass the federal threshold: more than $20,000 and more than 200 transactions in a year. A 2025 law restored that threshold (IRS FAQ).
- Some states set a lower threshold, as low as $600, so you may get a state form sooner. Check your state's revenue department.
- Card payments taken through a card processor can be reported with no minimum.
- Business income is taxable whether or not you receive a 1099-K.
What counts as income
Tax is owed on profit, not on everything you took in. For resale inventory, that is the sale price less what you paid for the item and your costs of selling: marketplace fees, shipping labels, supplies, booth rent and mileage.
Selling your own used things for less than you paid is generally not taxable income, but keep what you paid on record in case the sale is reported.
Sales tax
On shipped sales, eBay, Etsy and Facebook collect and pay sales tax for you in most states. For sales you make in person, you usually collect and pay sales tax yourself under your state's seller permit, so charge it at the register.
Records to keep
- What you paid for each item, and when.
- Every sale: date, price, where it sold and the tax collected.
- Marketplace fee and shipping label reports from each marketplace.
- Receipts for supplies, booth rent and sourcing trips, and a mileage log.
How VendorSnap helps
VendorSnap keeps what you paid on each item and records every sale, in person and online. The tax summary (Pro) exports a spreadsheet of each sale with the price, sales tax, where it sold, your cost and your profit. It does not track marketplace fees or shipping labels, so add those from your eBay, Etsy and Facebook reports. Try the profit calculator for a single sale.
Questions and answers
What is the 1099-K threshold for 2026?
Federally, more than $20,000 in payments and more than 200 transactions in a year from a marketplace or payment app. Some states use a lower threshold.
Do I pay tax if I did not get a 1099-K?
Business income is taxable either way. The 1099-K only reports payments; you report your income and costs on your return.
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