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joose2028
New Member

amazon vine 1099-nec can i deduct amounts if i can show what the item amazon charged as fair market but i have proof i could have bought item for less money ?

can i deduct amounts if i can show what the item amazon charged as fair market but i have proof i could have bought item for less money ?  can i somehow get the amount reduced as my current amazon vine amount is $29932 but I have proof i printed off website adds for items that i could have bought it for less.  I actually can show $4569 in savings vs what amazon vine sent to 1099-nec

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4 Replies

amazon vine 1099-nec can i deduct amounts if i can show what the item amazon charged as fair market but i have proof i could have bought item for less money ?

No. You can only deduct the actual cost you paid for the items.

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joose2028
New Member

amazon vine 1099-nec can i deduct amounts if i can show what the item amazon charged as fair market but i have proof i could have bought item for less money ?

i did not pay for the items.  amazon vine program i did product reviews and at year end they sent me a  1099-NEC.  In  box 1  they listed it as non-employee compensation.  example  theysent me a light fixture, i put it in my home and wrote areview about the product.  in the 1099-NEC itemized list of all products i received for year 2022 that perticular  light was listed at $209.00.   so they sent it to IRD as $209.00 product i received (not money)   i found it advertized online for $189.00.  so all products i reviewed so my 1099-NEC showed  over $29900 in products I've kept and reviewed.  but I have copies that i could have bought those items for less and true value would be less than $25,000.  shouldnt i be able to claim an adjustment to true value not what amazon charges?  (example in past years if i won cruise from a manufacturer and was 1099-misc for $6000 but i showed proof the exact same cruise was only $4000 if I booked it myself i was able to lower the tax amount to the $4000) thanks for help

DianeW777
Expert Alumni

amazon vine 1099-nec can i deduct amounts if i can show what the item amazon charged as fair market but i have proof i could have bought item for less money ?

Let's verify your activity.  It sounds like you decided to review products for Amazon and in return you were allowed to keep the products.  If that is true, then you were being compensated through product for your service of reviewing it. A receipt of a product is the same as a payment.

 

I understand your questions but as stated, you are not allowed to offset the income by what you could have purchased the same products at a lower price.  What you can do is to use any expenses that you had out of your pocket to earn this money.  Transportation, supplies, office space if applicable.  If you have no expenses then you will report all the amount reported to you.  

Next you must decide if this is a business or a hobby.  In the case of a hobby there is no ability to reduce the income by any expenses.

 

You can decide if it is hobby or business income.  This IRS link will help you: Business or Hobby?

 

Key elements:

  1. A hobby requires you to report the income you received and under the current tax law, Tax Cuts and Jobs Act (TCJA), no expenses are allowed to be used to reduce the money collected even if you itemize deductions.
  2. A business allows you to deduct the costs necessary to obtain the income.  The law explains that 'you must be engaged in the activity to produce a profit'.  The test under IRS tax law is that you must show a profit three out of every five consecutive years to be considered a business.

Once you decide what type of income this is you can use the links below to see how to report.

Self employment tax is 15.3% of any next profit in addition to your personal income tax. 

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FTB_User
New Member

amazon vine 1099-nec can i deduct amounts if i can show what the item amazon charged as fair market but i have proof i could have bought item for less money ?

Remember that what Amazon reports to the IRS are estimates. You may contest those estimates with sufficient proof that the market value of the reported item differs from Amazon's estimate. Screen shots of contemporaneous prices on eBay, Amazon, Wal*Mart for the same item would demonstrate market value. Also bear in mind that if the good in question is subject to recall by Amazon within 6 months of receipt before you may transfer it to another, you have received a leasehold, rather than full ownership. As such, the real value of what you received is the sum of a 6-month lease for the product on the open market + the residual value of the used good after 6 months of use.

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