I'm a Amazon Vine reviewer, so I receive free products from Amazon, which I can keep, in exchange for testing and reviewing the products. I will be receiving a 1099 with an Estimated Taxable Value (ETV) of the products, for which I have to pay income tax.
My question is, if I choose items specifically and exclusively for use in a separate business, can I deduct the ETV on that business's Schedule C? I would still be paying personal income tax on the ETV, but then I'd be paying an equivalent amount less from the business. At least to me, it seems functionally the same as if Amazon gave me the ETV amount in cash for services rendered, and then I used that cash to buy that same product for the business, i.e., it's a business deduction. What do you think?
For a little context, we've been having this discussion on a Reddit forum devoted to Vine, and several people claim it's a free product, and therefore, you can't deduct something that cost $0. My position is that it's not free, because we're exchanging a service to get it, and it's therefore compensation with a taxable value, it just happens to be in a non-cash form.
