Not tax advice — but ignoring this is a mistake
This is a general orientation, not tax guidance for your specific situation. Domain flipping income has real, sometimes non-obvious tax treatment, and "I'll figure it out later" gets expensive once a portfolio generates real revenue. Talk to a tax professional familiar with intangible-asset sales before you scale.
Capital gain vs. ordinary income
In the US, whether domain sale profit is taxed as a capital gain or as ordinary business income generally turns on whether you're a casual seller or operating as a business (frequency of sales, intent at purchase, how the activity is structured). A single domain held and sold occasionally looks different to the IRS than a portfolio actively bought and flipped at volume — the latter tends to be treated as ordinary income, taxed at a higher rate than long-term capital gains.
What counts as a deductible cost
Registration fees, renewal fees, backorder/catching service fees, marketplace listing commissions, and appraisal tool subscriptions are typical deductible business expenses if you're operating as a business. Keep records as you go — reconstructing a year of registrar receipts at tax time is avoidable pain.
International sellers
Selling to a US buyer as a non-US seller can trigger withholding requirements on the marketplace's side depending on your tax residency and any treaty in place. This varies enough by country that it's worth a direct question to whichever marketplace or escrow service you're using before your first sale, not after.
The practical habit
Track every purchase price, sale price, and associated fee in a simple spreadsheet from day one. Whatever the eventual tax treatment turns out to be, having clean records is the difference between an easy filing and a stressful one.