Last updated: September 14, 2026
$20,000 and 200 transactions. That's the 1099-K threshold for 2026, and if you spent the last two years bracing for a $600 form, the rule changed under you. The One Big Beautiful Bill Act, signed July 4, 2025, permanently repealed the $600 threshold that had been phasing in since 2024 and restored the original $20,000-and-200-transaction rule, with no sunset date. Fewer sellers get a form this year. Nobody's actual tax bill changed.
Quick timeline: the American Rescue Plan Act cut the 1099-K threshold to $600 starting tax year 2021, the IRS delayed it repeatedly, a phase-in eventually set $5,000 for 2024 and $2,500 for 2025, and then the One Big Beautiful Bill Act blew all of that up and put the original $20,000-and-200-transaction threshold back permanently. For 2026, a platform like eBay only has to send you a 1099-K if you cross both numbers on that platform in the calendar year. $25,000 across 40 transactions doesn't trigger it. 250 transactions totaling $8,000 doesn't either.
Here's the part that trips people up: the 1099-K threshold has never been a tax-owed threshold. It only controls when a platform is required to tell the IRS about your gross sales. Whether or not you get a form, the profit on cards you sold above what you paid for them is taxable income, and you're on the hook for reporting it either way. Fewer 1099-Ks going out this year just means fewer built-in reminders, not less tax owed.
Before any of the numbers matter, figure out which bucket you're actually in. The IRS runs on an "intent to make a profit" test, and it looks at the whole pattern, not one sale:
| Hobby / personal collection | Dealer / business | |
|---|---|---|
| Pattern | Occasional sales from your own collection, no consistent buy-to-resell activity | Regularly buying cards to resell at a markup, treated like a business |
| How profit is taxed | Capital gain: ordinary rates if held under a year, up to 28% max (the collectibles rate) if held over a year | Ordinary business income on Schedule C, plus 15.3% self-employment tax |
| Deductions | Very limited, mainly your cost basis against the sale price | Full business expense deductions: COGS, fees, supplies, mileage, grading, software |
| Losses | Generally not deductible on personal-use property | Deductible against other business income, subject to normal loss rules |
Most people reading a guide called "taxes for sports card sellers" are already in the dealer column, whether or not they've filed that way yet. If you're actively sourcing inventory and flipping it, the IRS is going to see a business, and it's better to file that way on purpose than to get recharacterized in an audit.
Two separate taxes stack on your net profit, not your gross sales:
Net profit, not gross revenue, is what gets taxed. Gross receipts (Schedule C Line 1) minus cost of goods sold, platform fees, shipping, and other business expenses gets you to Line 31, the number both taxes actually apply to. This is also why cards still sitting in your inventory at year-end don't count as an expense yet, they're an asset until they sell.
Basis is what you paid for the card, plus grading fees and acquisition costs. Sell a card for more than its basis and the difference is your taxable gain, dealer or collector either way. The trap is old cards with no paper trail: without records, the IRS default is a $0 basis, meaning your entire sale price counts as gain instead of just the profit. A documented, reasonable estimate based on period-appropriate comps beats nothing, but the cheapest fix is logging basis the day you acquire a card, not years later when you're trying to reconstruct it from memory. This matters even more for anything you're pricing off recent sales: see our guide on pricing sports cards with real sold comps, since the same comp data that tells you what to charge also documents what a card was worth if you ever need to substantiate basis.
The categories that cover most of a card business:
For the full Schedule C line-by-line breakdown and the eBay-fees trap that quietly overstates most dealers' profit, see card dealer accounting.
If you expect to owe $1,000 or more for the year beyond what's already withheld from a day job, the IRS wants quarterly payments, not one check in April. The 2026 due dates are April 15, June 15, September 15, and January 15, 2027. Skip them and you don't just owe the tax late, you owe an underpayment penalty on top, calculated from each missed due date even if you pay everything in full by the filing deadline. Once a card business is generating real, repeatable profit, this stops being optional in practice.
$20,000 in gross payments AND more than 200 transactions on a single platform in the calendar year, both conditions required. The One Big Beautiful Bill Act, signed July 4, 2025, permanently restored this original threshold and repealed the $600 rule that had been phasing in. A seller with $25,000 in sales across 40 transactions does not cross it, and one with 250 transactions totaling $8,000 does not either.
Yes. The 1099-K is a reporting form, not the thing that creates your tax obligation. If you sold cards at a profit, that profit is taxable income whether any platform sends you a form or not. Sellers who stay under every platform's threshold still owe the same tax on the same profit, they just have to track it themselves instead of getting a form as a reminder.
The IRS looks at intent to profit: do you buy cards to resell at a markup, track your sales, and run it like a business, or are you occasionally selling off your own collection with no real profit motive? Consistent, repeated buying-to-resell points to a business, filed on Schedule C. Occasional personal-collection sales lean hobby or personal-property sale. The classification changes your tax rate, your available deductions, and your paperwork, so if you're not sure, it's worth a real conversation with a CPA rather than guessing.
Ordinary income tax on your net profit at your regular bracket, plus 15.3% self-employment tax on that same net profit, 12.4% Social Security up to the 2026 wage base of $184,500 and 2.9% Medicare with no cap. You can deduct half your self-employment tax on your personal return, which softens it slightly, but there's no way around paying both pieces on a profitable dealer business.
If you're a collector selling off your own cards rather than running a resale business, any profit is a capital gain, not ordinary business income, and there's no self-employment tax. But cards are IRS 'collectibles,' so long-term gains (held over a year) max out at 28% federal, higher than the 15-20% most people expect for long-term stock gains. Cards held under a year are taxed as short-term gains at your ordinary rate. Either way, losses on personal-use collectibles generally are not deductible the way a dealer's business losses are.
What you actually paid for it, plus any grading fees or costs to acquire it, and that number does not change no matter how much the card has appreciated since. If you genuinely don't have a receipt from years ago, a documented, reasonable estimate based on what similar cards sold for around your purchase date is the standard fallback, but the IRS default assumption without records is a $0 basis, meaning the whole sale price counts as gain. This is exactly why logging cost basis on every card the day you get it, not the day you sell it, saves real money.
If you expect to owe $1,000 or more for the year after withholding and credits, generally yes. Card dealers with no separate day-job withholding to cover it almost always fall into this bucket once the business is real. The standard due dates are April 15, June 15, September 15, and January 15 of the following year. Missing them adds an underpayment penalty on top of the tax itself, even if you pay in full by the April filing deadline.
More on the accounting side in card dealer accounting, and on choosing a platform in sports card dealer software. Questions about anything else, email support@sportscardnetwork.ai.