Re: Tax advice
A refund/return is an expense. It's a positive entry when credited/sold, a negative when debited/refunded.
It will zero out except for the portion of the PP charge that is never refunded, I think it's $.30..., and shipping charges both ways, which you probably can't recover. You'll need to account for them somehow, because they're a loss.
There may also be a factor for loss of value of the product if it was/is defective or damaged or is no longer sellable as new. This is often less easy to determine.
Example:
Widget: +$10 gross revenue
Outbound Shipping: -$2.69 = shipping expense
EB/PP Fees: -$1.66 = cost of sale
+10-2.69-1.66 = +5.65 Profit
Refund: -$10
Return Shipping: -$2.69
EB/PP Fees Refund: +$1.36 (1.66 - .30 unrecoverable PP fee )
+5.65-10+1.36-2.69= -$5.68 ( loss on sale )
This offsets $5.68 of profit, so it's of value to you, it's 5.68 of money you won't pay taxes of 21-33% on.
I think I did this correctly, it's 4AM, you should be able to get the general idea.
Last edited by dallis; 04-20-2018 at 03:22 AM.
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