Trading Card & Collectibles Taxes

Tax help for trading card, sports card and memorabilia sellers in Hawaii. In office in Honolulu or online.

If you sell trading cards, sports cards or memorabilia for more than you paid, the profit is taxable. That's true whether you sold one graded card or run a full-time shop. The key is knowing what you paid, what it cost to sell, and whether the IRS sees you as a collector or a business. We help Hawaii card sellers report sales correctly, keep the records that prove their costs, and stop paying tax on money they never made.

Yes, on the profit. Your profit is the sale price minus what you paid for the item and what it cost to sell it, like platform fees and shipping.

If you sell an item from your personal collection for less than you paid, that loss generally can't be deducted.

It depends on how you operate. If you regularly buy cards or memorabilia to resell for profit, the IRS will likely treat you as a business. If you are selling off pieces of a collection you built for enjoyment, you are likely a collector.

Collector: profits are capital gains. Collectibles held more than a year are taxed at a top federal rate of 28%, higher than the rate on stocks.

Business: profits go on Schedule C and are subject to self-employment tax. In exchange, you can deduct business expenses such as supplies, grading, shipping, show tables and travel to shows.

Getting this wrong in either direction costs money, so it's one of the first things we look at.

You don't owe tax on the whole amount. A 1099-K reports the total payments you received, not your profit. You report the 1099-K amount, then subtract what you paid for the items and your selling costs.

The IRS matches 1099-Ks to tax returns, so leaving one off can trigger a notice even if you made no profit. The federal reporting threshold is $20,000 and 200 transactions, but sales below that are still taxable.

If you sell as a business, generally yes. Hawaii's General Excise Tax applies to gross receipts, not profit, at 4.5% on Oahu. Rules for sales shipped to buyers outside Hawaii can differ, so we review where your buyers are. See our Hawaii GET Tax page for how filing works.

Keep enough to prove what you paid and what you received: the purchase price and date for each card or lot; grading fees and shipping to the grader; platform fees, payment fees and shipping costs; and sales reports and payouts from each platform. For breaks and sealed product, keep what you paid for the box and how that cost is split across the cards pulled.

A simple spreadsheet updated monthly beats a shoebox at tax time. We can set one up with you.

Inherited items generally get a cost basis equal to their value on the date of death, so a large part of the gain may not be taxable. A dated appraisal or price records from that time help you prove it.

Report your sales correctly, matching every 1099-K to your return with cost and fees subtracted.

Rebuild missing cost records from order history, bank records and price data.

Decide collector or business, and set up the return to match.

Set up simple recordkeeping you can update in minutes each month.

Handle Hawaii GET registration, filing and catch-up for missed periods.

Plan as you grow, including LLC or S-Corp setup when sales volume makes it worth it.

Answer IRS letters, including notices about 1099-K income that didn't match your return.

Your advisor is Jacob Siaosi, an IRS Enrolled Agent with RP Tax Service in Honolulu. Enrolled Agents are licensed by the IRS and can represent taxpayers before it.

Tell us roughly how much you sold, where you sell, and whether you received a 1099-K. We'll tell you what you need and what it will take. In office on McCully Street or fully online from any island. 

Call 808-946-7297.

This page is general information, not tax advice for your situation. Tax rules change; contact us before acting on it.