Why your whatnot 1099-K is more than you made
The 1099-K reports what buyers paid before fees, labels and refunds came off. How to get from that figure to what you kept, for Schedule C.
Updated · 6 min read
Your 1099-K reports gross payments, unadjusted for fees, refunds or shipping. So it's bigger than what reached your balance, and bigger again than your profit. Schedule C starts from sales and takes costs off.
$10,455.80
Schedule C net profit for a made-up year where buyers paid $31,284.00.
Who gets one
A marketplace must send a 1099-K when your payments for goods top $20,000 across more than 200 transactions in a year. The IRS says the One, Big, Beautiful Bill restored that threshold retroactively, to where it stood before the American Rescue Plan Act of 2021. A platform may still send one below it, and some states have lower thresholds.
For 2025, whatnot issued it through Stripe to US sellers who cashed out with Stripe and crossed a federal or state threshold. All your income belongs on your return either way.
What box 1a counts
The IRS calls box 1a the total payments before fees, credits, refunds, shipping, cash equivalents or discounts, and says you can deduct those. It ignores what your stock cost.
whatnot's 2025 article says the form reports all your whatnot earnings, without the amounts behind the figure. So whatROI's bridge starts from everything buyers paid on completed sales (item, shipping and sales tax) and works down. Compare it with your form.
A worked year
The numbers are made up. A seller makes 1,200 card sales at $20.00 each, at whatnot's standard 8% commission. Each buyer also pays $4.47 shipping and 8% sales tax. 10 sales are refunded and billed back with the card gone. The seller gives away 50 cards and takes $250.00 in tips.
- What buyers paid on completed salesItem, shipping and sales tax
- $31,284.00
- Buyer shipping and sales taxPassed through to labels and tax
- -$7,284.00
- Commission and processing
- -$3,192.00
- Refund billbacksThe payout plus the buyer's shipping and processing
- -$228.70
- Giveaway labelsShipping the seller paid
- -$223.50
- Tips
- $250.00
- Paid into the balance
- $20,605.80
That $20,605.80 is the sum of every Transaction Amount in the year's Weekly Orders Reports, before card costs. From September 21, 2026, sellers with $15,000 or more of sales in four weeks pay less than 8% commission.
To Schedule C
Schedule C starts again from sales, then takes off refunds, cost of goods and expenses. whatROI's tax pack maps the year like this:
| Line | What goes on it | Amount |
|---|---|---|
| 1. Gross receipts | Sales that stood, after your coupons, plus tips | $24,050.00 |
| 2. Returns and allowances | Shipping and processing billed back on refunds | $55.30 |
| 4. Cost of goods sold | What the cards you sold cost, lost ones included | $9,600.00 |
| 8. Advertising | What the giveaway cards cost | $150.00 |
| 10. Commissions and fees | Commission and processing on sales that stood | $3,165.40 |
| 22. Supplies | Sleeves, top loaders and mailers | $400.00 |
| 27a. Other expenses | Giveaway labels you paid for | $223.50 |
| Net profit | $10,455.80 |
Line 1 is $24,050.00: $23,800.00 of sales that stood plus $250.00 of tips. The 10 refunded sales come off it with their fees, and line 2 carries the rest of their cost. Cost of goods is the biggest deduction. No whatnot report shows it unless you typed a cost on every listing, and supplies bought elsewhere are missing too.
Before you file
- Download the annual Seller Statement from Finances. whatnot calls the statements, the Ledger and the 1099-K the source of truth, and says the weekly report isn't an official document.
- Statements count a sale when it completed, which can be days after it was placed. A late-December sale can land in the next year.
- Keep receipts for every lot, case and supply run. Line 4 and the expense lines rest on them.
- This guide isn't tax advice. Take the bridge and your Schedule C figures to a tax professional before you file.
The report analyzer adds up a Weekly Orders Report in your browser, fees, refunds and tips included. The file stays on your device. whatROI's tax pack (Pro) builds the bridge and the Schedule C lines from the reports you import.