Are EBay Fees Included In 1099? | Gross Sales Vs Your Payout

No, Form 1099-K lists gross payment totals, so eBay selling fees don’t get subtracted on the form.

If you sell on eBay, the number on your 1099-K can feel off. Your payouts land after fees, refunds, and shipping labels. The form often looks bigger than the cash you kept.

This article explains what that total is made of, what it leaves out, and how to match it to your seller reports so your return reflects your real profit.

What a 1099-K is reporting on eBay

Form 1099-K is an information return. It reports payment activity for goods or services paid through cards, payment apps, and online marketplaces. On eBay, it’s closer to gross receipts than to your payout.

One extra wrinkle: a platform can send a 1099-K even when you didn’t hit the federal reporting threshold. The IRS notes that marketplaces are required to report when payments for goods or services go over $20,000 in more than 200 transactions, yet forms can also be sent at lower amounts. Some states set their own lower thresholds, so the mailing rules can feel inconsistent across sellers. No matter what you receive, you still report taxable income from sales.

Gross payments vs payouts

Your payout is what you receive after eBay takes selling fees and after other adjustments. The 1099-K total sits earlier in the chain. It reflects money that moved through the payment network tied to your orders.

So a single sale can show up three ways: the buyer sees one charge, you see a net payout, and the form shows a gross payment number meant to line up with the processor’s records.

Are EBay Fees Included In 1099? What the boxes mean

For most sellers, Box 1a is the number that drives questions. The IRS describes Box 1a as the gross payment amount and says it does not include adjustments such as fees, credits, refunds, shipping, cash equivalents, or discounts. IRS Form 1099-K FAQs (gross amount) states this directly.

eBay says the same thing in its seller help: the form reports unadjusted gross payment transactions and does not subtract fees or refunds, while sales tax and canceled transactions are excluded from the gross amount it reports. eBay and Form 1099-K lists what’s included.

So where do the fees go?

Fees don’t vanish. You handle them in your accounting and on your return. If your eBay activity is a business, selling fees and payment processing fees are usually part of deductible selling expenses. Your tax is based on net profit, not on the gross 1099-K total.

If you sold personal items, the tax result can be different. A 1099-K can still arrive, yet taxable income might be only the gain on items sold for more than you paid. The form reports gross payments; your records show what portion is taxable.

Why the 1099-K total can be higher than your bank deposits

Most gaps come from normal parts of selling that change cash flow without changing the gross payment figure on the form.

Buyer-paid shipping

If a buyer paid shipping at checkout, that amount can be part of the gross payment total. You may later buy a shipping label out of your payout, so your bank sees less.

Refunds and disputes

Refunds cut your cash, yet the form’s gross payment total does not net out refunds. Keep refund reports so your books show the true net result.

Sales tax handled by the platform

In many states, marketplace facilitator rules mean sales tax is collected and remitted by the platform, not paid out to you. eBay notes sales tax is excluded from the gross amount it reports. Still, your downloadable reports are the best way to see how your account handled each order.

How to reconcile eBay totals to your tax return

Reconciliation is matching numbers with a trail you can explain. Treat the 1099-K as one data point, then tie it to your transaction exports and fee statements.

Step 1: Pull the reports that match the year

Gather your 1099-K, eBay’s 1099-K detail report, your order report, and your monthly fee statements for the same calendar year. The detail report matters since it lists the transactions that roll up into the form.

Step 2: Split sales into tax buckets

Make a simple split that matches how you’ll report income:

• Business inventory sales
• Occasional selling that you treat as hobby activity
• Personal items sold at a gain
• Personal items sold at a loss

The IRS has a plain page on where 1099-K amounts often get reported and what to do if a form is wrong or unexpected. What to do with Form 1099-K is a handy cross-check while you sort categories.

Step 3: Build the net number you’ll report

For business sales, your backbone is gross receipts minus refunds and returns, then minus costs and expenses. eBay fees, payment processing fees, shipping labels, and packing supplies usually fit on the expense side. Your bookkeeping method decides the exact labels.

For personal items, taxable gain equals what you received minus what you paid (your basis). A loss on a personal-use item is usually not deductible, so receipts matter most when an item might sell above your original cost.

Item In Your eBay Activity	How It Tends To Show Up	Typical Treatment In Your Records
Item price paid by buyer	Included in 1099-K gross payments	Income as business receipts or sale proceeds
Buyer-paid shipping	Often included in gross payment total	Income, with postage tracked as an expense if you paid it
eBay selling fees	Not subtracted on the form	Expense for business activity
Payment processing fees	Not subtracted on the form	Expense for business activity
Refunds you issued	Not netted in the gross amount	Track as returns/allowances to reduce income
Shipping label costs	Not part of the 1099-K total	Expense for business activity
Sales tax collected and remitted by eBay	Excluded from gross amount per eBay policy	Not your income if you never received it
Fee credits and promos	Not shown as a fee reduction on the form	Track credits in statements so fee totals stay accurate

What counts as taxable income when fees are not deducted

The 1099-K is not a profit report. Your job is to report taxable income that fits your facts, then keep records that show how you got there.

Business sellers

If you operate like a store, taxable income is profit after expenses. A 1099-K that lists gross payments does not change that. It’s simply a number the IRS can match against payment processor data.

Hobby sellers

Some sellers clear out collections without running a business. You still report taxable income. Recordkeeping matters, since expense treatment can differ from business activity.

Personal items

Many personal-item sales are not taxable because you sold at a loss. A 1099-K can still list gross payments. Your receipts and notes show whether a gain existed.

Recordkeeping habits that save time

You don’t need complex tools. You need repeatable tracking.

Keep these totals as you go

• Order-level gross amounts from buyers
• Refunds, cancellations, and disputes
• Fees and fee credits
• Shipping label costs and postage
• Cost of goods sold for inventory items
• Receipts for personal items that might sell at a gain

Stick to the same date window

Your 1099-K is based on a calendar year. Match your exports to that same window so comparisons stay clean.

Watch for more than one 1099-K

If you accept payments across platforms, you can receive more than one 1099-K. The IRS explains who sends the form, who receives it, and why you might receive one even when you didn’t cross a platform’s threshold. Understanding your Form 1099-K walks through those basics.

Reconciliation Check	What You Compare	What A Mismatch Often Means
1099-K Box 1a vs eBay 1099-K detail export	Total gross payments	Wrong year, missing account, or tax ID issue
Gross payments vs order totals	Item price plus buyer-paid shipping	Date timing differences or excluded cancellations
Refund totals vs bank outflows	Refunds and disputes	Refunds processed after year end or grouped payouts
Fee totals vs monthly statements	Final value fees, listing fees, ad fees	Fee credits or separate billing cycles
Shipping label costs vs carrier receipts	Postage paid	Labels bought off-platform or voided later
Sales tax lines vs payouts	Tax collected by marketplace	Tax was not paid to you, so it should not be income

Clean way to explain the mismatch if the IRS asks

Keep a short packet you can export or print:

1. The 1099-K and the eBay transaction export that matches its total.
2. A one-page summary that subtracts refunds and returns from gross receipts.
3. Monthly statements that total up fees and other selling costs.
4. Bank deposits that show how gross payments turned into net payouts.

That packet answers the core question: “Why does the form say X while you received Y?”

Next steps for this week

Download the detail export, total your fees, and separate personal items from business sales. Once those three pieces are in place, your 1099-K stops being a surprise and turns into a number you can explain.