<prompt> Human: Hello all! In 2013 I used eBay as a side business for some extra income. I primarily sold trading cards, and at the end of the year lost more money than I gain so i thought. I didnt include eBay or PayPal on my taxes or anything for that matter in 2014 when 2013 taxes were due. I received a letter in the mail from the IRS stating that PayPal reported me as having taken in 27k and the IRS wants their cut of roughly 4,000. I know that I lost money through my eBayPayPal store, and my PayPal could prove it I assume.Some options Ive already considered: Try to import 2013s PayPal history into Quickbooks and break it up into tax deductible and not tax deductible and hope for the bestORImport everything as a csv into Google Sheets, total it all and see what it says. This option wont work so well because it includes the times were I spent money on random stuff and was sent money for non-business things.Any advice? Thanks in advance for any advice or support. Ive spent this entire year trying to get on top of my finances and as Im nearing stability this happens. Life in a nutshell.Assistant: Even if you lost money, you still need to include that on your taxes. Right now the IRS just sees the money you made and didnt report. Since you never included a schedule C, they have no way of knowing you spent money. Make sure you have receipts for everything, otherwise youre in for a bad and expensive lesson on tax evasion. Human: The number that they report me having made is significantly more than I actually took in, even if we dont include lost money.Assistant: Where did they get that number? The IRS is going to side with PayPal firstly because they reported the income, while you did not which will make you looks suspicious. Youre going to be fighting an uphill battle. You will need to prove everything you earned and everything you spent. I hope you kept receipts for everything. You might want to talk to a tax attorney. Human: For a 4k dispute?Assistant: Ill be talking to a tax attorney as soon as I can. The reason the entire situation caught me off guard is because I didnt gross anywhere near 27k  <response>: Stop typing on here. Go to eBay and PayPal and draw up the records of what you did do. That should be sufficient evidence of actual transactions. 