Let's say you run a web site just as a hobby (not as a big business), and you made 100 dollars from Google adsense. Where would this get reported on your personal federal income tax form?
wrote
Line 21, as other income.
-- Paul Thomas, CPA snipped-for-privacy@bellsouth.net
You should be able to list it on a Schedule C, taking any deductions against the income (such as for hosting costs, internet access costs, etc.). The hobby loss rules may come into play if you try to claim expenses greater than the income. Otherwise, you can list it as "other income" on the first page of your return. Kreig Mitchell
Schedule C
snipped-for-privacy@coolgroups.com posted:
Line 21 - "Other Income." As noted in the Form 1040 Instructions, this seems to precisely fit the definition given in the list of examples: "Income from an activity not engaged in for profit." Bill
Line 21 form 1040, under other income.
Missy Doyle
But getting the google ads was done for profit (what other reason would there be?) Seth
Well, you intend to receive money, certainly. But do you intend to receive enough to pay all your expenses of going on the internet and running the "business" plus a net profit at the end? In any case, it looks like passive income to me.
Stu
"Other income" as previously noted, possibly offset by hobby expenses itemized on Sched A subject to 2% AGI floor. Regarding Google adsense, I designed (for free) a web site for a non-profit organization a few years back and implemented Google adsense for two reasons: one, the experience of learning how to do it, and two, because it added a little bit of richness and flavor to an otherwise content-poor web page. Actually getting any money was not expected and did not occur. Similarly, if a hobbyist hands out business cards which result in some hobby income, I wouldn't automatically ascribe a profit motive solely based on that fact.
-Mark Bole
I started a blog myself in Dec 2006. So far it has earned about $ 97.00 and I won't get paid until it reaches $100. The purpose of my blog was NOT to make money, and my cost is zero since I can't deduct the value of the time I spend on it. I am going to add the $100 or so I make in 2007 to my schedule C, which means I'll pay self-employment tax on it. If I weren't filing a Schedule C, I could either file it as "other income' on line 21 or file a Schedule C-EZ. If you have any small expenses you could deduct them on Schedule C-EZ
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.