Sports card taxes and the 1099-K
This is general education, not tax advice. Rules change and depend on your situation — check with a qualified tax professional.
As online marketplaces report more seller activity to the IRS, more card sellers are receiving a Form 1099-K. Here's what that means and why keeping good records matters.
What is a 1099-K?
A 1099-K is a form that payment platforms and marketplaces (eBay, PayPal, and others) send to sellers and the IRS reporting the total payments they processed for you in a year. The reporting thresholds have been trending lower, so hobby sellers who never used to get one increasingly do. Importantly, a 1099-K reports your gross sales — not your profit.
Why cost basis is everything
You're generally taxed on your gain, not your gross sales. If you sell a card for $200 that cost you $150 (plus fees and shipping), your taxable gain is far less than the $200 the 1099-K reports. That's why tracking cost basis— what you actually paid, including fees and shipping — is the single most valuable habit for a seller. Without it, you can end up overpaying because you can't prove what a card cost.
Hobby vs. business
How your card activity is taxed can differ depending on whether it's treated as a hobby or a business, which affects what you can deduct. This is exactly the kind of question to take to a tax professional — but either way, the records you need are the same: what you bought, what it cost, what you sold, and the fees involved.
What records to keep
- Purchase price of each card, plus shipping, fees, and tax
- Sale price of each card and the marketplace fees taken
- Dates of purchase and sale
- A running total of realized gains and losses for the year
How tracking makes this painless
Your receipts already contain all of this. My Card Inventory reads your purchase and sale emails to keep cost basis and realized profit up to date automatically, then produces a tax-ready summary you can hand to your accountant — so 1099-K season is a download, not a spreadsheet marathon.