A client took in over $8,000 in gross sales in 2021, on somewhere between 250-300 transactions using Paypal on the sale of their used clothing.  Based on those numbers, this seems to be rising to the level of a reportable trade or business. 

They have original receipts for all items and are using these for their cost basis.  After Paypal fees and shipping costs, they have calculated a small loss, but because they are selling used personal property, this loss is not deductible to them. 

The ProSeries Schedule C does not seem to allow for this situation or the reporting of a nondeductible loss on a “business.”  When I try to zero out the loss as an expense line item entitled “nondeductible personal property loss,” it won’t allow a negative expense figure.  Is there another way to report their figures without taking the Schedule C loss?

They believe their sales will be even greater for 2022, so they will undoubtedly receive a 1099-K in 2022 and will face this same issue.