Amazon Vine 1099nec

[Real Deal]

I am in the amazon vine voice program and I have spoken to the irs about this issue which they are on my side but cant provide advice when it comes to filing taxes. We in the vine voice program receive items in the hopes we would leave a review for them. My question is how is reviewing "promotional offers" considered taxable when you arent receiving any income from these items or reselling them to receive any income? This doesnt make any sense especially since amazon doesnt own these products. 3rd party sellers give these free items to amazon voice members. Also in the FAQs they state "We do not require that you write a review" which means there is no service being provided. Also no where in the agreement does it mention that anyone in the program is to perform a service, mention that anyone in this program is an independent contractor or mention these promotional offers as a form of income. Here is the exact wording from the agreement

"Products enrolled in the Program (“Vine Products”) may be provided by third-party suppliers
and made available to you through the Program (“Third-Party Products”) or manufactured by
or on behalf of Amazon or its affiliates (“Amazon Products”). You acknowledge and agree that all Vine Products are:
promotional offers to you and are not sold to you, and
provided to you on an "as is" basis – Amazon makes no product warranties to you, and
accepts no responsibility for return, repair, refund or replacement. Amazon will only
deliver Vine Products selected by you to the primary US delivery address associated with
your customer account. Your ongoing right to participate in the program and your
eligibility to receive Vine Products is at Amazon's sole discretion"

My second question is how can I zero out this "taxable income" from the 1099nec and add a note explaining the reasoning for this which I mentioned about to the irs? The IRS told me if I move forward with this that they will follow up with a report to amazon. Thank you for your time

[Real Deal]

I also want to mention that im not the only person that spoke to the irs about this https://www.youtube.com/watch?v=tWiIiqOVBFg&list=LL&index=14&t=622s&ab_channel=MoneyStruggleSuccess

[NCperson]

@Real Deal - could you resell these items? does anything preclude you from doing so? 

what types of items are you receiving?

Before agreeing to be part of this program, what did Amazon disclose about taxable income to you? 

Let's say a 3rd party seller provided Amazon with a Tesla that Amazon gave you, expecting you to write a review.  If you turned around and sold the Tesla OR just kept it., would you be arguing that you should not be receiving the 1099NEC?. Why or why not? 

[Real Deal]

To answer your question if a company gave you a free car to do as you please you can use it to drive which doesnt mean you have to pay taxes on it because it was a gift. Unless you decide to sell it for a profit and at that case you would have to report it because its a sale. I am not required to sell an item if it was given to me as a promotion and if I did sell any item then I would of course pay taxes on whatever item I sold. I didnt get invited into the program to make it a business. My intention isnt to get items to sell them, I was invited because I always leave reviews for many years and they saw it possibly made an impact on there sales or conversions so they invited me. I dont mind receiving free items just like anyone else wouldnt mind receiving free anything. This is equivalent to someone who always uses uber or lyft and they provide them with promotional free rides (which is an actual thing that happens) and then you using the promotional rides then they say its taxable

[Real Deal]

"The tax authorities require all Vine Voices to provide tax information to be compliant. The Tax
Interview is used to determine and fulfill Amazon’s tax reporting and withholding obligations
For US persons, tax reporting is required to the extent that goods $600 or more is received by
an Amazon Vine participant.
In order to fulfill the IRS requirements as efficiently as possible, answer all questions and
enter all information requested during the Tax Interview. Use caution to avoid misspellings or
entering incorrect Tax Identification Numbers, which can result in an invalidated tax form. If
you have questions, please consult your tax advisor."

This is the information which is just a copy and paste for anyone who is considered an independent contractor which I am not nor have they mention this in the actual agreement and the IRS has stated im not an independent contractor by their standings after speaking to legal from their department and disclosing all the information amazon has provided me and the agreement

[NCperson]

@Real Deal - this may get you close to the answer to your 2nd question: 

While it relates to receiving an errant 1099K, it is very similar to what you are asking.

if someone was to receive an errant 1099K, the IRS states to report that 1099K as normal and then  turn around and zero it out by reporting it as an 'other adjustment; on Form 1040, Schedule 1, Part II – Line 24z and indicate a short reason.  look at the 2nd page of the link below. 

https://www.irs.gov/pub/irs-pdf/f1040s1.pdf

on your first question, and this is just my opinion, and I confident others will chime in, the IRS defines a gift as

"You make a gift if you give property (including money), or the use of or income from property, without expecting to receive something of at least equal value in return"

So I could see the arguement that Amazon doesn't see this as a gift as they ARE expecting someting of at least equal value in return (the product reviews).   and if it isn't a gift, then what is it? income?  Also, I wonder if how all those questions were answered on the form you filled out for Amazon brought them to the conclusion that they had to issue a 1099NEC.  Certainly Amazon didn't put that set of questions together without a purpose (and without lawyers involved!),

[Critter-3]

Bottom line is if a 1099 NEC has been issued you must deal with it on your tax return in some fashion. You have to decide which way to deal with it yourself based on the information you have on this situation. Failure to enter this income and deal with it in some fashion on the 1040 will result in you getting an IRS audit letter in a couple of years and you will have to address this at that time. So better to address it now than to let the IRS question it later.

[Real Deal]

Thank you for that information, its something I will look further into for this adjustment. As far as your what you mentioned I never claimed amazon mention this is a "gift" It is a "promotional offer". In our agreement it doesnt say this offer is considered a form of payment in exchange for any type of service whatsoever. Im sure Amazon lawyers came up with this form to classify everyone inside the program as an independent contractor to not have to deal with these taxes themselves. This is just one of the many ways this huge corporation pays next to nothing when it comes to paying taxes.

[Real Deal]

I understand this and what you mentioned is exactly what the IRS agents I spoke to told me. They said you could go the route of not addressing it in your future taxes but this will end up with a follow up letter a few years down the road. They said its best to speak to my tax professional to address this when taxes are due and they will do a follow up with me and send a report to amazon

[Mike9241]

i would agree with @NCperson last paragraph. Amazon sees the products you receive as compensation for preforming the reviews.  Despite what the IRS agent says I would agree with the assessment.   this is somewhat like what happens to contestants on prize shows that win prizes like TVs Fridges, cars, trips, swimming pools. they get a 1099 and its for full Fair Market Value even if the item is worthless to them.  

do what you want for tax purpose but if might help your position if you were to contact that agent too find out what code section exempts it from being income. Eventually you may be audited and the IRS or the courts will make a decision on the matter that will serve as a precedent. 

[Real Deal]

amazon can see things however they want but no where in the agreement does it state that. This isnt a prize which is subjected to FMV its promotional offers which is not the same and no service is being provided