When I entered the amount as self-employment income (Sched. C), my federal and state refunds actually increased. Given that I am not required to report this on my federal return (the number of transactions and amount of sales fall below minimum), I don't know if this is correct. I live in Massachusetts which has lower thresholds but I don't know if this type of income -- just selling some of my used CDs through an online service -- even needs to be reported.
