You $21,000 is not business income because you were not operating a "business" to make a profit. Mainly you want to show the IRS you doing this NOT to make money.
Be as specific as possible and provide documentation of the 501(c)(3) and how everything worked.
This explanation of hobby income may be helpful (your income and hobby income are both reported on Schedule 1, line 8 and both an nonprofit activities) in explaining that you were not trying to make money.
You would be self-employed if:
- You carried on the activity in a businesslike manner and maintained complete and accurate books and records.
- You had personal motives in carrying on the activity.
- You put time and effort into the activity to make it profitable.
- You depended on income from the activity for your livelihood.
- You or your advisors had the knowledge needed to carry on the activity as a successful business.
- You were successful in making a profit in similar activities in the past.
Having some of these would not disqualify you from NOT being self-employed. The whole picture counts.
How do you distinguish between a business and a hobby?
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