I'll preface this by saying I'm not an accountant. You should consult one to get the information.

When you return inventory, it changes the stock on hand you have. At the end of the year, for your taxes, you need to itemize inventory and report the value of inventory you have on hand. It would change that.

You will have a net loss because you paid for the inventory but only received 90% of that retail value back.

There's nothing to enter to show you returned inventory, per say. It's all in the numbers.

Last year, I'm guessing what you're saying is that you showed a profit in your business, which increased your taxable income.

I hope your husband used Turbo Tax. It walks you through everything. But when in doubt, run it by a tax accountant.

If I'm off base, I'm sure someone here will let me know.

(I also deleted your duplicate post to another board because that isn't allowed. )

Are we supposed to get some kind of tax form from MK?  I have all the forms with my orders, but I didn't get a 1099 (I think that's what it is called).  I joined at the end of June and returned my inventory in November.  Do they just consider me a loss and I don't have to do anything?  I just about broke even in the endeavor I think.   Does anyone have the number I should call to get this straightened out.  I've called the number on the MK website but that is just for customers.  I'm in Maryland (DC suburbs) if that helps with the number I would need.

I believe you only get a 1099 if you make over $500 or $600 dollars. What you can print from the mk site is an "Income Advisory Statement". It is found under "my business" then "reports.

Wait, now that I printed it off, here's what it states on it:

"If your wholesale purchases totaled more than $5,000 or you received $600 or more in commissions, prized and awards, or you had any amount of Federal income tax withheld during the tax year, you should also receive a For 1099-MISC from Mary Kay."