I have a side gig speculating in domain names. This entails:
- Looking for unregistered domains that I think have value
- Valuing domains using various websites
- Registering and renewing the domains, generally for multiple years
- Listing the domains for sale on online brokerages
- Negotiating with buyers
- Transferring domains to the buyer
A couple of questions:
- Should I consider this a (Schedule C) business, in which the domain names are my inventory? Or are my domain names investments that would generate capital gains/losses rather than business gains/losses?
- At this point, I've retired from searching for new names for several years. Now I just maintain my existing inventory and very occasionally sell a domain (e.g., maybe one a year). Does this change the situation? (E.g., does this mean I'm no longer an "active" participant in the business?)
