I have an ebay mystery auction and need help from a tax accountant!?

Question

do an advanced search on ebay seller name- danbumpy

Do I have to pay taxes on bidder gifts. Also can I deduct the cost of the items included in my auction?

Answer 1

Yes, you would pay taxes on any profit - that is the amount the winning bidder pays, minus your cost for the items sold (you can call them prizes if you want to, or gifts, but they are items sold).

If the shelter is a 501(c)3 designated organization, then you could deduct the amount given to them as a charitable contribution, subject to limits based on your income if you itemize. If they're not 501(c)3, then you can't take a deduction for money given to them.