ThomasM125
Employee Tax Expert

Get your taxes done using TurboTax

It is possible that the IRS would consider this a business since you indicated that you do it to get "Stuff that is helpful" evidently. The value of what you receive is treated as income, even though you do not receive cash. Since the value of what you received is more than the associated costs you incurred, you likely do have a business profit that would be subject to self-employment tax.

 

It is possible that the value of the goods listed on the Form 1099-Nec is more than their true value, so you may be able to enter a deduction for that difference. Use the "other" cost of goods sold category in TurboTax to reduce the self-employment income if appropriate. If you enter that expense in the inventory section when you enter your business expenses, and the amount reduces your gross profit below $400, then you will not be subject to self-employment tax. If you choose this option, look for Inventory/Cost of Goods Sold in the list of business expenses and enter $0 for the value of your beginning and ending inventory. 

 

 

 

 

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