Garage Sale Gains: Are They Taxable?

Summer is when many people clean out closets, hold yard sales and sell items online. Is that money taxable? If you sell personally owned items, you generally only have to report income if you receive more than you paid for the items (or the price of a gift that you sell). Most items decrease in value over time, so chances are you’re incurring a loss and don’t need to report a sale. But if you’re fortunate enough to buy an item for $1, then find out it’s an antique that you sell for a small fortune, the sale is likely taxable. Keep accurate records. Also, if an occasional sale becomes an ongoing activity, the IRS may decide you’re running a taxable business. Contact us with questions.