A lot of this depends on how you're going to enter this into your tax return. If you are entering this as hobby income as we started with then all of the income is taxable and you don't get to deduct expenses. But on the upside you are not subject to self-employment tax.
If you decided to create a business on your tax return as a self-employed reviewer then anything that you had to purchase in order to do the job would be deductible including the business portion of your internet and your laptop and any product used up in the review process.
In the case of a business where you were writing a review in exchange for money then you would deduct the product that you bought and used up in order to write that review. You would use your own money to purchase that product so you would have a deduction for buying it. In this case they just took out the middle man so you could deduct the cost of the candy bar when it is sent to you.
In the case of items not used up but resold later - you would have to take them into taxable income initially. Then they would go to inventory.
So you receive a $10 widget for review. That is ten dollars in income to you and that income has turned into $10 in unsold inventory.
Then, when you sell it, you could indeed have a gain or loss on the inventory in your store.
I would keep meticulous records if you're going to go this route. I would also make sure to note that because of that six month gap you are definitely going to have a number of products that are in your inventory and can't be sold that you will be paying taxes on at the end of the year and receiving deductions on in the following year. And whatever the income is on those products in inventory and the ones you decide to keep for personal use you will be paying self-employment tax on.
@JayJay808
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