It depends. Based on the amount it would seem this was a business, self employment activity. However, if you believe it was a hobby, you can choose to report it that way but you will not be allowed to reduce the gross amount by any expenses that may be associated with it. Below is information to help you decide if it was self employment or a hobby.
Any income received for services or goods is taxable. You have to decide if it's a hobby or a business for tax purposes. Review this page from IRS:
Key elements:
- A hobby requires you to report the income you received and under the current tax law, Tax Cuts and Jobs Act (TCJA), no expenses are allowed to be used to reduce the money collected even if you itemize deductions.
- A business allows you to deduct the costs necessary to obtain the income. The law explains that 'you must be engaged in the activity to produce a profit'. The test under IRS is that you must show a profit three out of every five consecutive year.
Once you decide what type of income this is you can use the links below to see how to report.
The IRS will be looking for the amount be on your tax return in either category.
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