If I refund a buyer money, is that factored into my total sent to the IRS at the end of the year? Or do I have to write it off as a loss?

 

Are partial refunds treated differently?

We use our paypal monthly summaries which lists refunds as its own category. The monthly sunmaries are helpful because they list total payments received, total fees and total spent....Your 1099k will list every dollar you received including payments for shipping and handling. This gross payments received will be your starting place to start subtracting things refunds will probably be your first subtraction....Then subtract paypal fees ebay fees postage paid business use of your home utilities internet shipping supplies...Then you will subtract your costs of goods everything you paid on items to resell...This number minus other deductions credits is you AGI adjusted gross income in other words your taxable income...Paypal will have every cent on the 1099k and it will be on you to subtract out all your business expenses and the refunds you have issued...

this is on schedule C partial refund is no different. We come up with our total refunds sent per month then per year and this is one of the first subtractions we make to the LARGE number on the 1099-K...

OK, so these are sections on the Paypal reports you print out for the year? I feel like I saw it before but can't remember where.

The basic monthly PayPal reports will show your income, refunds, fees, withdrawals, etc.

 

There's a more comprehensive report under "history" that you can run for any time period you want, comma or tab delimited, so it can be transferred to an Excel spreadsheet. That one gives you every possible detail you'll need of every transaction of every type that you ran through PayPal for the year.