- How does this revenue effect my personal income filing / is it "zeroed out" by being given to charity?
- Would expenses I have accrued as part of this be something I could put down as business or similar expenditures? We've spent a lot of money on resources for the stream and will continue to do so, so I don't want to leave money on the table if they can be considered business expenses or similar.
Is this activity engaged in for profit or a hobby?
from the IRS
A hobby is any activity that a person pursues because they enjoy it and with no intention of making a profit. People operate a business with the intention of making a profit. Many people engage in hobby activities that turn into a source of income. However, determining if that hobby has grown into a business can be confusing.
To help simplify things, the IRS has established factors taxpayers must consider when determining whether their activity is a business or hobby.
These factors are whether:
- The taxpayer carries out activity in a businesslike manner and maintains complete and accurate books and records.
- The taxpayer puts time and effort into the activity to show they intend to make it profitable.
- The taxpayer depends on income from the activity for their livelihood.
- The taxpayer has personal motives for carrying out the activity such as general enjoyment or relaxation.
- The taxpayer has enough income from other sources to fund the activity
- Losses are due to circumstances beyond the taxpayer's control or are normal for the startup phase of their type of business.
- There is a change to methods of operation to improve profitability.
- Taxpayer and their advisor have the knowledge needed to carry out the activity as a successful business.
- The taxpayer was successful in making a profit in similar activities in the past.
- Activity makes a profit in some years and how much profit it makes.
- The taxpayer can expect to make a future profit from the appreciation of the assets used in the activity.
All factors, facts, and circumstances with respect to the activity must be considered. No one factor is more important than another.
If a taxpayer receives income from an activity that is carried on with no intention of making a profit, they must report the income they receive on Schedule 1 line 8
also no expenses are allowed
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if for profit then schedule C..
as to expenses what is the activity?
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charitable contributions can not be used to offset income. At best they are an itemized deduction that goes on schedule A. To be of any benefit, these contributions and any other itemized deductions would need to exceed your standard deduction.
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Your activity might qualify as a charity, but only the IRS can determine this by filing appropriate paperwork. Formal documents and state filing might also be required. Considering the low amount of revenue this is probably not financially feasible.
