The 1099-K, Explained for Card Sellers

A marketplace sends you a form that says you were paid a big number this year. That number is not your profit, and if you treat it like your profit, you will pay tax on money you never kept.

If you sell cards through eBay, TCGplayer, or a similar marketplace, a 1099-K can show up in your mailbox or inbox around January. The dollar figure on it is often alarming, higher than you remember banking, and nowhere near what the show season actually left you. That gap is not a mistake on the form. It is what a 1099-K is built to report, and reconciling it correctly is a ten-minute job if you kept the right numbers during the year and a real headache if you did not.

What a 1099-K actually reports

A 1099-K reports gross payments processed through a platform: the total dollar amount of sales that cleared through that marketplace's payment system, before the platform's fees come out and before you factor in what the cards cost you. It is a payments form, not an income form. The IRS uses it to see that money moved through a payment processor to you; it says nothing about what you spent to have those cards in the first place.

If you sold on more than one marketplace, you may get more than one 1099-K, each covering only that platform's payouts. None of them know about each other, and none of them know your cost basis.

Why the number on the form is not your profit

Three things separate the 1099-K total from what you actually made:

• Marketplace and payment fees. The gross figure is before the platform's cut, not after it.
• Shipping you collected. If a buyer paid you for shipping, that often shows up in gross payments too, even though most of it went straight to postage.
• What the cards cost you. The form has no idea what you paid for the inventory you sold. A $4,000 gross payout on cards that cost you $2,600 to acquire is a very different year than $4,000 of pure profit.

Your actual taxable profit is gross sales minus your cost of goods sold minus your deductible expenses, and the 1099-K is only the first of those three numbers.

Reconciling payouts against cost basis and fees

Reconciliation is just matching the platform's total against your own records, one line at a time if you have to. For each sale that fed into a 1099-K, you want to be able to point to what that specific card cost you when it entered your stock, and what the platform and shipping took out before the payout landed.

A short worked example: a marketplace's 1099-K shows $9,000 in gross payments for the year. Platform and payment processing fees on those sales came to $650. Buyers paid you $310 for shipping, and shipping actually cost you $280, close enough that it mostly washes out. What is left is cards that cost you a combined $5,100 to acquire across the year. Run the subtraction and the taxable profit behind that $9,000 form is closer to $3,250, not $9,000. None of that math is hard; the only hard part is having the $5,100 figure ready instead of guessing at it in April.

This is easiest when you record cost basis the moment a card enters inventory rather than trying to remember it later, and when your sales records are tagged with where each sale happened. A card tracked from the day you bought it, with a market value and a cost attached, gives you both halves of the subtraction without a January scramble. CardOps keeps that cost basis and sale history on the device as you sell, and CSV export (a Pro feature) lets you hand your accountant one file that lines up against the marketplace's own report instead of a shoebox of printouts.

What to keep in case the number is questioned

A 1099-K by itself proves money moved. It does not prove what you made, so the records that back up your own number matter more than the form does. Keep, for every sale that matters:

• What you paid for the card and when (your cost basis).
• What it sold for and on which platform.
• The marketplace and payment fees taken from that sale.
• Shipping cost versus shipping collected.
• Any grading or other cost tied to that specific card.

None of this needs to be elaborate. It needs to exist, attached to the card, before the sale happens, not reconstructed from memory after a form arrives.

The threshold keeps moving, so check the current year

The dollar amount and transaction count that trigger a 1099-K have changed more than once in recent years, and they differ by platform in how aggressively each one issues the form below the legal floor. Do not plan your record-keeping around last year's threshold, because you may get a 1099-K this year at a total that would not have triggered one two years ago, and the reverse is also possible. The safest assumption is that any marketplace income is reportable whether or not a form shows up, and the form is simply a prompt to reconcile, not the trigger for whether you owe anything. Confirm the current year's threshold and your filing obligation with a tax professional; this is a record-keeping method, not tax advice.

If you sell across several marketplaces and your own table

Most dealers who show up at conventions are not selling through one channel. A single season might include eBay, TCGplayer, a Facebook group, and straight cash across the table at a show, and only the marketplace sales generate a 1099-K at all. That split creates two separate reconciliation problems: matching each platform's form against its own payouts, and then adding in the cash and in-person sales that never generate any form but are just as taxable.

The fix is the same habit either way: record cost and sale price per card as it happens, with a note on where it sold, rather than treating the 1099-K as your bookkeeping. The form only covers one slice of the business. Your own running total, show by show and platform by platform, is the number that actually has to hold up, whether or not a marketplace sends you paperwork for that slice of it.