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If I buy a TV for $100 and sell it for $200 I've heard some people say need to pay income tax on that $100. If I sell it for $50 can I write off the $50 loss. If I have a garage sale and sell all my old crap is that income I need to report? Loss I need to take advantage of or something else?

  • 1
    What country are you asking about? Tax rules vary. – Chris W. Rea Jul 10 '16 at 3:38
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If the items you sold are items you previously bought for a higher price, the money you get selling them is not income, as you are taking a loss. However, you cannot deduct such losses.

If you sell anything for more than what you paid for, the difference is a gain and is taxable.

See this IRS web site for the explanation: https://www.irs.gov/businesses/small-businesses-self-employed/tax-tips-for-online-auction-sellers

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If I sell it for $50 can I write off the $50 loss.

Only if you can establish that it is a normal part of your business and that you did not get $50 worth of use out of it. That's the technical, legal argument. As a practical matter, it's unlikely that they'll ding you for selling something after using it, as they won't know. If they did catch you, you would be in trouble. You can't deduct loss due to personal use.

The larger problem is that if you sell one TV for a $50 loss, they aren't going to believe that you are in the business of selling TVs. If you sell a larger amount for a loss, then they still are unlikely to believe that you are in business. If you sell a large amount for an overall gain, they are unlikely to notice that you took a loss on one TV. They could only notice that if they were already auditing you, as that wouldn't be visible in your tax forms.

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Yes. This income would be reported on schedule SE. Normally, you will not owe any tax if the amount is less than $400.

Practically, $100 in a garage sale is not why the IRS created the form SE. I wouldn't lose sleep over keeping track of small cash sales over the course of a year. However, if you have the information I'm not going to tell you not to report it.

  • And the opposite question? If I sell $10k of used furniture for $500 can I write off $9.5k of loss? – gman Jul 10 '16 at 2:27
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    That is wrong. See this link for the correct answer: irs.gov/businesses/small-businesses-self-employed/… – Aganju Jul 10 '16 at 3:08
  • @Aganju thanks for the link, that is a good resource. I don't think my answer is wrong, but perhaps unclear based on the OP's question. The link indicates that items sold at a profit should be reported. If you sold TV's as the OP indicates at a garage sale, how would this not be income? – jkuz Jul 10 '16 at 13:32

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