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Selling, fees & tax

Collectibles Tax Calculator

The same $20,000 of card sales produces three very different tax bills depending on whether the IRS sees you as a hobbyist, an investor or a dealer. The difference is mostly about whether your costs are deductible, and it is larger than most sellers expect.

Your year

$
$

Purchase price plus grading fees.

$

Marketplace fees, postage, supplies, show travel.

— estimated federal tax on this year's sales

The same year under all three classifications.
ClassificationTaxableRateTaxWhat you can deduct

Estimates for US federal tax only, ignoring state tax, NIIT and self-employment tax. This is arithmetic, not advice — any substantial sale warrants an accountant.

Three classifications, three completely different bills

  • Hobbyist. Income is fully taxable and expenses are not deductible — the TCJA suspension of miscellaneous itemised deductions made that permanent. This is the worst of the three and the default for most collectors.
  • Investor. Purchase price and grading fees add to basis, and long-term gains are taxed at the collectibles rate — capped at 28% rather than the 15–20% that applies to shares.
  • Dealer. Files Schedule C. Every cost is deductible — fees, postage, supplies, show travel, grading — but the profit is ordinary income and also carries self-employment tax.
You do not simply choose. The IRS applies a nine-factor test covering profit motive, time invested, expertise, and whether you depend on the income. Selling forty cards a year while working full time elsewhere is a hobby whatever you call it.

The 28% rate, and when it does not apply

Collectibles carry a maximum long-term capital gains rate of 28%, against the 0/15/20% that applies to shares. It is a cap, not a flat rate — if your bracket is lower, you pay the lower figure. And it only applies to items held over a year. Sell inside twelve months and the gain is ordinary income, taxed at up to 37%, which makes fast flipping the most heavily taxed activity in the hobby.

The 1099-K threshold is not the tax threshold

For 2026 the federal reporting threshold is more than $20,000 in gross payments and more than 200 transactions. Below that you may receive no form. That changes nothing about what you owe: profit is taxable from the first dollar, form or no form. What the threshold determines is whether the IRS is told about it independently.

Questions people ask about this

Do I have to pay tax on selling sports cards?

Yes, on the profit, from the first dollar — whether or not a 1099-K is issued. Long-term gains on collectibles are taxed at up to 28%, higher than the rate on shares. Cards held under a year are taxed as ordinary income at up to 37%. The 1099-K threshold only decides whether the platform reports it, not whether you owe it.

What is the 1099-K threshold for 2026?

More than $20,000 in gross payments and more than 200 transactions for the 2026 tax year — both conditions, not either. This reverted from the much lower thresholds that had been proposed. Receiving no form does not make the income untaxable; it only means the platform has not reported it separately.

Can I deduct grading fees and shipping from card sales?

It depends entirely on your classification. A dealer filing Schedule C deducts everything — fees, postage, supplies, grading, show travel. An investor adds purchase price and grading to the cost basis, which reduces the gain. A hobbyist deducts nothing at all: income is taxable and expenses are not deductible, which is the harshest treatment of the three.

Am I a hobbyist, an investor or a dealer?

The IRS decides using a nine-factor test — profit motive, time and effort invested, expertise, dependence on the income, and whether you operate businesslike records. Frequent buying and selling with the intent to profit points to dealer; buying and holding for appreciation points to investor; collecting what you like and occasionally selling is a hobby. The label is not a choice you make on the return.

Where these numbers come from

Rates on this page were last checked against the published price lists on . Grading companies change fees and pause tiers without notice — confirm the total on the submission form before you pay.