Sports Card Taxes in 2026: The 1099-K, Cost Basis & Deductions Guide

Nobody gets into sports cards because they love bookkeeping. But if you sell cards — on eBay, at shows, on Whatnot, anywhere — taxes are part of the business whether you track them or not. And the single most expensive mistake in the hobby is not a bad grade or an overpay. It is selling all year, getting a tax form in January, and having no records to prove what you actually made versus what you sold.

This guide covers what you need to know for 2026: the 1099-K threshold as it actually stands, why cost basis is the number that protects you, and the deductions card sellers routinely leave on the table. This is general information, not tax advice — for your specific situation, talk to a professional. But read this first so you know what to ask.

The 1099-K Threshold for 2026

For a few years the 1099-K reporting threshold was a moving target, with talk of a $600 trigger that had sellers panicking. Here is where it actually landed: for tax year 2025 — the return you file in 2026 — the federal threshold is back to more than $20,000 in gross payments AND more than 200 transactions. Both conditions, not either.

So eBay, PayPal, Whatnot, and similar platforms will issue you a Form 1099-K by January 31, 2026 if you cleared both bars on that platform. A few important catches:

• Some states set a lower threshold. Several states require reporting well below the federal numbers. Check your state — you may get a 1099-K even if you're nowhere near $20,000.
• The form shows GROSS, not profit. The number on a 1099-K is total payments received before fees, shipping, refunds, and discounts. It is not your income. It will look scary and it is not the number you are taxed on.
• No form does not mean no tax. This is the one that catches people. The 1099-K is a reporting threshold. If you sold cards at a profit, that profit is taxable income whether or not a platform sent you a form. The form is paperwork; the tax obligation exists regardless.

That last point reframes everything. The question is not "will I get a form?" It is "do I know my profit?" — because you owe tax on profit either way.

Cost Basis: The Number That Saves You Money

Here is the concept that the entire thing hinges on. You are taxed on your gain, not your sales. Gain is simple:

Sale price − cost basis − selling costs = taxable gain

Cost basis is what you paid for the card, plus costs to acquire and improve it — the purchase price, grading fees, and so on. Selling costs are platform fees, shipping, and supplies.

Picture two collectors who each sold $25,000 of cards last year.

Collector A kept records. She can show she paid $18,000 for those cards, plus $3,000 in eBay fees and shipping. Her taxable gain is $4,000. She is taxed on $4,000.

Collector B kept nothing. He has a 1099-K showing $25,000 and no proof of what he paid. In the eyes of the IRS, an unsupported cost basis can be treated as zero. Worst case, he is looking at tax on the full $25,000 — six times Collector A's bill — for the exact same real-world profit.

Same activity. Wildly different tax outcome. The only difference is records. Cost basis is not bookkeeping busywork — it is, very literally, the difference between a $4,000 taxable number and a $25,000 one.

This is why "track your cost basis" shows up in nearly everything we write, from card show setup to flipping. It is not a nag. It is the highest-leverage habit in the hobby, and tax season is where it pays out.

Hobby vs. Business: Why It Matters

The IRS treats a hobby and a business differently, and it affects what you can deduct.

If card selling is a hobby, you still owe tax on gains, but your ability to deduct expenses and losses is limited.

If it is a business — you operate with continuity and the genuine intent to profit — you generally report on a Schedule C, can deduct ordinary and necessary business expenses, and can offset losses against income. The trade-off is self-employment tax on net profit.

There is no single switch that flips you from one to the other; it is a facts-and-circumstances judgment. But one fact weighs heavily in your favor if you want business treatment: operating like a business. Real records, tracked inventory, documented cost basis, separate accounting. A pro can advise on which side you fall — but you cannot make that case at all without records.

Deductions Card Sellers Routinely Miss

If you qualify for business treatment, these are the expenses sellers most often forget to claim:

• Platform and processing fees — eBay's final value fees, Whatnot fees, payment processing. On thousands in sales this is a large number.
• Shipping — postage, tracking, insurance. Both what you charge and pay out.
• Supplies — penny sleeves, toploaders, team bags, bubble mailers, slab boxes, label printer and labels.
• Grading fees — submission costs are part of a card's cost basis or a deductible expense depending on treatment.
• Card show costs — table fees, travel, mileage, parking, and lodging for shows you sell at.
• Software and tools — subscriptions you use to run the operation.
• Home office — if you have a dedicated space used regularly and exclusively for the business, a portion of home costs may qualify.

Every one of these requires the same thing: a record. A deduction you can't document is a deduction you can't safely take.

How to Actually Stay Ready

You do not need an accounting degree. You need a system that captures four things for every card, as it happens:

1. What you paid (cost basis) — the moment you acquire the card.
2. What you paid in addition — grading, supplies attributable to it.
3. What it sold for — gross sale price.
4. What the sale cost you — fees and shipping.

Do that at the point of each transaction and tax season becomes a report you run, not a forensic reconstruction of a year you barely remember.

This is built into how Slabfy works. Every card in your collection carries a cost basis from the day you add it. When you sell — through the Card Show POS or by marking a card sold — the sale price, payment method, and your real profit are captured automatically. Your portfolio shows realized and unrealized gains across the whole operation. When a 1099-K shows up in January, you are not staring at a scary gross number with no context. You can show, card by card, what you paid and what you made. The platform tracks the data the IRS effectively assumes is zero unless you prove otherwise.

If you run shows, Show Wrapped already gives you the revenue, cost-of-goods, and profit breakdown per show — that is your tax record building itself in the background.

A Simple Year-Round Routine

• At purchase: log the card with its cost basis immediately. Not later. Later never comes.
• At grading: record the fee against the card.
• At sale: capture sale price, fees, and shipping. Mark it sold.
• Monthly: glance at your realized gains so the year-end number is never a surprise.
• In January: when 1099-Ks arrive, reconcile them against your records and hand a clean profit figure to your tax pro.

Five small habits. They turn the most stressful week of a card seller's year into a non-event.

The Bottom Line

The 2026 1099-K threshold — $20,000 and 200 transactions federally, lower in some states — decides whether a platform mails you a form. It does not decide whether you owe tax. Profit from selling cards is taxable income regardless, and the seller who wins is simply the one who can prove their cost basis.

Track what you pay, track what you sell, track the costs in between — every card, as it happens. Do that and a 1099-K is just a form you reconcile in ten minutes. Skip it and that same form is a five-figure question you can't answer in your favor.

Track cost basis and real profit on every card automatically. Start with Slabfy for $1.