There is a business category for "Internet Auctions." You can deduct reasonable costs of the business such as PayPal fees, eBay fees, postage, cost of goods sold and that sort of thing. Do at your own risk: Deduct your Automobile and Travel Expenses including Breakfast at Tiffany's and Dinner at the South Point, and meet the fascinating hard-working ladies and gentlemen who work as IRS Auditors. Have you ever been in a Turkish prison?