How do I pay taxes on things that I sold that I purchased with cash?
I have an online business on Ebay. I purchase my inventory with cash and make a pretty hefty profit on it. The problem is that I have no idea how to show my proof of how much profit I made since I don t have any receipts of the purchases that I made since i buy my inventory with cash. What can I do to pay taxes for these items that I sell online? My supplier only accepts so I don't have a choice on getting receipts.
- JudyLv 72 years ago
You track what you paid for each item.
- STEVEN FLv 72 years ago
Contact a CPA LAST YEAR. You ABSOLUTELY MUST learn to keep proper records.
As things stand, the IRS will not dispute claiming 100% of your gross revenue as profit.
- David 14Lv 72 years ago
- NALv 72 years ago
No receipts means no deduction when audited.
When paying cash, you keep a log of what you purchased as well as proof of other expenses. You can only deduct the cost of the inventory you actually sold.