Amazon Vine SSI and Hobby Income

[Callie66]

A little over a month ago I was invited to become a member of Vine. I was thrilled and immediately jumped in with both feet. Just like I always do. I never test the water. I never look around for signs that warn about stumps in the river. I never do ANYTHING. Nope, not me! I just dive right on in. And that’s what I did. I’ve gotten things for all my kids, all my grandkids, my sons-in-law, lots for myself. I mean, it was all free, right?! All I have to do was write a review!! And it didn’t even have to be a 5 star review, just an honest one! Man, I can DO that. I really, really can. And the only thing was, once I go over $600 I gotta pay taxes. NO PROBLEM! Even once I figured out they meant Federal tax, it was no problem. But then…I realized that wasn’t what they mean’t at all! The SS is going to count this as income! But how can they?! For the last almost 25 years I haven’t been able to do ANYTHING for my children, for my grandchildren. For my family. For once, I was finally able to do nice things, good things, for everyone in my family. Things I’ve never been able to do in my whole adult life. 

So anyway, my question is, can I file taxes and report this as Hobby Income even though as an SSI recipient I’m not required to file taxes?

[xmasbaby0]

Even hobby income is income.   Sounds like what you are worried about is whether the amount of income you have received will make your Social Security taxable.   When Social Security is your ONLY income it is not taxable.  But when you have other income in addition to the SS, it might become taxable, depending on how much income you received.

Up to 85% of your Social Security benefits can be taxable on your federal tax return.  There is no age limit for having to pay taxes on Social Security benefits if you have other sources of income along with the SS benefits.  When you have other income such as earnings from continuing to work, investment income, pensions, etc. up to 85% of your SS can be taxable. 

 What confuses people about this is that before you reach full retirement age, if you continue working while drawing SS, your benefits can be reduced if you earn over a certain limit. (For 2019 it was $17,640— for 2020 it was $18,240; for 2021 it was  $18,960.  For 2022 it was  $19,560  —  for 2023 $21,240)

After full retirement age, no matter how much you continue to earn, your benefits are not reduced by your earnings; your employer will still have to withhold for Social Security and Medicare.

To see how much of your Social Security was taxable, look at lines 6a and 6b of your 2022 Form 1040

https://ttlc.intuit.com/questions/1899144-is-my-social-security-income-taxable

https://www.irs.gov/help/ita/are-my-social-security-or-railroad-retirement-tier-i-benefits-taxable

You need to file a federal return if half your Social Security plus your other income is $25,000 when filing single or head of household, or $32,000 when filing married filing jointly, $0 if you are filing married filing separately.

Some additional information:  There are 11 states that tax Social Security—Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, and Vermont  These states offer varying degrees of income exemptions, but two mirror the federal tax schedule: MN and VT.

And...Social Security and "SSI" are not the same thing.  If you receive SSI, it is not taxable and does not ever even go on a tax return.   If you are receiving Social Security, then you get a SSA1099 from Social Security.  Do you get a SSA1099 each year?  They send them in January.

WHAT IS THE DIFFERENCE BETWEEN SOCIAL SECURITY BENEFITS AND SSI?

https://www.ssa.gov/ssi/text-over-ussi.htm

[rjs]

The $600 threshold is the point at which Amazon has to send you a 1099-NEC. It applies to Amazon, not to you. It has nothing to do with whether you have to file a tax return or pay tax.

If your net self-employment income is $400 or more you are required to file a tax return, whether or not you get a 1099-NEC. If it's over $432 you will have to pay self-employment tax, even if your income is not high enough to have to pay regular income tax.

When you say that you get SSI, do you mean Supplemental Security Income, or do you mean that you get Social Security Benefits, for either retirement or disability? SSI and Social Security are two different kinds of benefits, but they are both paid by the Social Security Administration. You could get both, but they are treated differently for taxes.

SSI does not have to be reported on your tax return, but being "an SSI recipient" does not necessarily mean that you do not have to file a tax return. If SSI and Social Security are your only income you do not have to file a tax return. But if you have more than certain amounts of other income, such as $400 or more of self-employment income, you do have to file a tax return. If you do file a tax return, you have to report your Social Security income, although only some of it, or possibly none of it, will be taxable. You do not have to report SSI, even if you do file a tax return.

The income from Amazon Vine is self-employment income, not hobby income. You have to report it as self-employment income. It's not clear what you thought would be the benefit of reporting it as hobby income, but you don't really have a choice.