| With the increase in bloggers, affiliate marketers, eBay | | | | income. Even if you don't receive a Form 1099, your |
| sellers and other online business owners, the topic of | | | | income is still reportable. |
| reporting miscellaneous income and 1099 forms has | | | | It is a common misconception that if a taxpayer does |
| been coming up a lot lately. | | | | not receive a Form 1099-MISC or if the income is |
| While most people are aware they must report | | | | under $600 per payer, the income is not taxable. |
| wages, salaries, interest, dividends, tips and | | | | There is no minimum amount that a taxpayer may |
| commissions as income on their tax returns, many | | | | exclude from gross income. |
| don't realize that they must also report other income, | | | | Independent contractors must report all income as |
| such as: | | | | taxable, even if it is less than $600. Even if the client |
| * cash earned from side jobs, | | | | does not issue a Form 1099-MISC, the income, |
| * barter exchanges of goods or services, | | | | whatever the amount, is still reportable by the |
| * awards, prizes, contest winnings and | | | | taxpayer. |
| * gambling winnings | | | | The good news is that as an independent contractor, |
| Basically, you have to report all income from any | | | | or as a self employed business owner, you get to |
| source (and any country) unless it is explicitly exempt | | | | deduct ordinary and reasonable business expenses |
| under the U.S. tax code. | | | | against your income. |
| That means if you earn money from ads on your blog, | | | | To report your income and expenses from your online |
| selling items on eBay, selling products for a commission, | | | | business, use Schedule C: Profit or Loss From |
| or providing a service to another person (even if that | | | | Business, which is then attached to your Form 1040 |
| service is all done via the Internet), then you must | | | | (your personal tax return). You must also complete |
| report that income. | | | | Schedule SE to calculate your self employment taxes |
| If you work as an independent contractor and earn | | | | if your net profits from your business exceed $400 for |
| $600 or more (from one company or individual), you | | | | the year. |
| should receive a Form 1099-MISC reporting your | | | | |