If I sell on Facebook Marketplace or NextDoor, are the profits taxable?

Q. I know a number of people who earn money by buying items at estate sales and thrift stores, then selling those items at a profit through websites like Facebook Marketplace or Nextdoor. For some people it is more of a hobby but for several it is their primary source of income. Is this income taxable? How should it be accounted for?— CuriousA. That’s a great question.Online marketplaces have indeed become more popular in recent years.For anyone who is in the business of buying and selling anything, the profit is subject to both income tax and self employment tax, said Michael Karu, a certified public accountant with Levine, Jacobs & Co. in Livingston. It would get reported on Schedule C as a business, he said.It’s important to note that it is not the difference between the selling price and purchase price that is taxable, Karu said.“Expenses incurred in order to create the income also would be deductible,” he said. “For example, the mileage driven to and from the estate sales could be deductible.”Also remember that anyone who is in the business of selling products needs to be registered with the State of New Jersey for sales tax.Email your questions to…
Read More