I collect shoes, and occasionally I will sell things I do not or wear or no longer want. I will be receiving 1099’s from stockx ebay and alias. I also work a full time job. How do I claim this income on my taxes, is it considered a hobby or is it considered self employment?
All income needs to be reported on your tax return, even if it's from a hobby. This is a great article about IRS guidelines for a hobby versus small business: When the IRS Classifies Your Business as a Hobby Some of the questions listed in this article for determining if you have a hobby or small business are as follows:
- Do you put in the time necessary to turn a profit
- Have you made a profit in the past or expect to make one in the future
- Do you depend on the income from this activity
Hobby income is report on line 8 of schedule 1 of Form 1040. Hobby losses are not deductible.
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I have made a profit on some pairs of shoes, but any profit I have made just went into other shoes. I do not depend on any income generated from this hobby either. I should be safe to claim this income as a hobby and not a small business?