@fujipro400 wrote:
Thank you! This brings up another question though. If I'm not making less than $400 from the business, is it worth the time to report and seek out these deductions given that my taxable income is almost irrelevant? Should I just wait until my channel grows before seeking these deductions out?
This is a minefield and I want to call in reinforcements. @Hal_Al @DoninGA @TomD8
Some brief words:
Sometimes if you show a loss (net operating loss) on your "side gig", you can use it as a tax deduction against your other income (such as your W-2 "day job"). And sometimes, if you can't use all the deduction this year, you can carry the deduction forward to next year (which will reduce your future tax on your business) and sometimes you can carry the loss backwards and use it to reduce prior year income taxes by filing an amended return.
(Remember there was supposedly a "scandal" when the New York Times published Pres. Trump's tax returns and showed he paid little current tax on his business because he was still deducting huge past losses from when he almost went bankrupt. And for many years, Amazon paid no corporate income tax because they were still deducting their startup losses even after they became hugely profitable. Ordinary people can sometimes use the same rules for their own benefit.)
This is complex and I don't know enough to comment further with any intelligence, hence the call for reinforcements.
Also, if you purchased equipment for the business, there may be advantages to listing it as a business asset now rather than waiting.
