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I'm helping my son prepare taxes. He didn't earn any income…

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I'm helping my son prepare...
I'm helping my son prepare taxes for 2013. He didn't earn any income and covered his living expenses through a 401(k) distribution (2012) and sale of personal assets. How should the sale of assets be reported?
Submitted: 2 years ago.Category: Tax
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Answered in 7 minutes by:
3/11/2016
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 18,052
Experience: 15years with H & R Block. Divisional leader, Instructor
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Hello

If he sold personal assets that were in the nature of a "garage sell" meaning he sold items he had held for a long time and did not receive more for them than he paid, you are not required to report those at all.

In a garage sale, you generally sell household items you purchased over the years and used personally. If you paid more for the items than you sell them for, the sales are not reportable. Losses on personal use property are not deductible, either.

If his sales developed into a business and/or he had recurring sales and purchased items for resale with the intention of making a profit; he may have started an business. Then you report on Schedule C.

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