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Level 1

Do I file Amazon Vine product value as misc. work income or hobby income?

I am in Amazon's Vine program were they send products out to customers to have them reviewed. I am a Vine customer. I don't pay for these Vine products. They are sent so that I can review them. They are officially mine after 6 months. Amazon sent out a 1099-MISC form with the 6 month depreciated values all added together.
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Level 7

Do I file Amazon Vine product value as misc. work income or hobby income?

If this is a hobby you can report the income and then deduct any actual expenses that are ordinary and necessary for you to receive and keep the products to the extent of the income value.  These expenses could be used as an itemized deduction for any amount that exceeds 2% of your adjusted gross income (AGI).  The difference would be added to other itemized deductions so that TurboTax could maximize your deduction.

Whether the expenses are used on itemized deductions or whether you use the standard deduction the income must be added to the return.

To record your hobby income and deductions you can follow the steps here.

  1. Sign into your TurboTax account - 
  2. Search hobby income in the upper right
  3. Then Jump to hobby income, loss
  4. Enter your income and expenses
  5. TurboTax will calculate your allowable expense and total itemized deductions

Be sure to add all itemized deductions to maximize the hobby expenses.

If you decide that this is more of a business, for which you plan to profit you could utilize the business Schedule C.  It's all right if you aren't quite sure yet.  You can always report it as a business if you find it becomes more than a hobby later.  

Either way you will need to use TurboTax Deluxe to add the income because the IRS does not allow this to be reported on a Form 1040EZ or 1040A.  It's more complicated than the short form.  

If you want to record it like as a business, instead of a hobby and use the expenses you can use TurboTax Self Employed.

You can go directly to the area to enter the document by following these steps.

1. Sign into your account and select your current return.

2. Select  My Account on the top right and then select Tools

3. Select Topic Search (see attached image)

4. Search for business and select Go

5. Follow the interview to enter or review your entry.

11 Replies
Level 7

Do I file Amazon Vine product value as misc. work income or hobby income?

If this is a hobby you can report the income and then deduct any actual expenses that are ordinary and necessary for you to receive and keep the products to the extent of the income value.  These expenses could be used as an itemized deduction for any amount that exceeds 2% of your adjusted gross income (AGI).  The difference would be added to other itemized deductions so that TurboTax could maximize your deduction.

Whether the expenses are used on itemized deductions or whether you use the standard deduction the income must be added to the return.

To record your hobby income and deductions you can follow the steps here.

  1. Sign into your TurboTax account - 
  2. Search hobby income in the upper right
  3. Then Jump to hobby income, loss
  4. Enter your income and expenses
  5. TurboTax will calculate your allowable expense and total itemized deductions

Be sure to add all itemized deductions to maximize the hobby expenses.

If you decide that this is more of a business, for which you plan to profit you could utilize the business Schedule C.  It's all right if you aren't quite sure yet.  You can always report it as a business if you find it becomes more than a hobby later.  

Either way you will need to use TurboTax Deluxe to add the income because the IRS does not allow this to be reported on a Form 1040EZ or 1040A.  It's more complicated than the short form.  

If you want to record it like as a business, instead of a hobby and use the expenses you can use TurboTax Self Employed.

You can go directly to the area to enter the document by following these steps.

1. Sign into your account and select your current return.

2. Select  My Account on the top right and then select Tools

3. Select Topic Search (see attached image)

4. Search for business and select Go

5. Follow the interview to enter or review your entry.

Level 1

Do I file Amazon Vine product value as misc. work income or hobby income?

Do I put the income in the hobby income and deductions section even though I received a 1099-MISC? I'm confused because Turbotax also suggests entering it in the 1099-MISC section under self-employment.
Level 1

Do I file Amazon Vine product value as misc. work income or hobby income?

Same problem.  TurboTax sees the number in Box 7 on the 1099-MISC and decides you are Self-Employed and makes you file a Schedule C.  This is a change from last year (please do not point us to the original answer).

Is there a way to prevent this and go back to doing it the old way?  Having to file Schedule C over some free samples is a bit absurd.
Level 7

Do I file Amazon Vine product value as misc. work income or hobby income?

@Bryan1UP  & @user77222 Your questions can be entered into your own string by using the link here: <a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/">https://ttlc.intuit.com/</a>  This allows you to track your own answers.
That being said, if this is a hobby for you and not a business venture you must enter the income as shown above for hobby income.
If you consider this a self employment activity where you are being paid in product for your services in pursuit of a profit, or you are selling product you purchase as well, then you must report it on Schedule C as Nonemployee Compensation (self employment).
Level 1

Do I file Amazon Vine product value as misc. work income or hobby income?

Thanks for your willingness to help.  It is very appreciated.  

In an attempt to clarify the issue, let me restate it:  The issue here is that TurboTax will not let you do that.

As soon as you enter information in Box 7, it generates the Schedule C.  If you manually delete the Schedule C, then the income disappears completely.  It is impossible to add the 1099-MISC with info in Box 7 without getting a Schedule C.

Are you suggesting we do not actually report the a 1099-MISC and manually put it in as hobby income?  If so, is that not likely to result in a nasty letter from the IRS asking why you did not report the 1099-MISC?
Level 7

Do I file Amazon Vine product value as misc. work income or hobby income?

@user77222 Yes, that is what I am suggesting.  You may get a letter from the IRS, at which time you will explain that this is a hobby without pursuit of a profit in an ongoing business concern if this is your plan and activity supports it.
Level 1

Do I file Amazon Vine product value as misc. work income or hobby income?

OK--thanks for your help.
Level 1

Do I file Amazon Vine product value as misc. work income or hobby income?

Thanks so much. I am following your advice and filing my vine 1099-Misc as hobby income as well. This reviewing thing has become nerve wracking!
Level 1

Do I file Amazon Vine product value as misc. work income or hobby income?

So, TT is forcing an incorrect outcome in their programming.  Can you consider having a 'default override', so that when one inputs a 1099-MISC that is ACTUALLY FOR HOBBY INCOME, such as VINE reviews, it is allowed, without triggering Schedule C automatically?  Having to complete Schedule C, or ignoring the 1099-MISC and entering as hobby income are BOTH INCORRECT ACTIONS.  And filing a Schedule C makes my state makes them think I owe them general excise tax on sales, which I did not have!  TT, please fix this!  Your software is wrong, for the second year in a row!!!!!
Level 6

Do I file Amazon Vine product value as misc. work income or hobby income?

Is this a joke? I don't know what "Level 7" means, but since 2018, under the Tax Cuts and Jobs Act, you can no longer deduct hobby expenses. Income is reportable, expenses aren't deductible, full stop.

Highlighted
Level 20

Do I file Amazon Vine product value as misc. work income or hobby income?

OK... sadly the questions were moved from the old forum to this  new one the end of May 2019 and the old posts were given 2019 dates which is giving people the wrong answers for the current year rules.

 

For 2018 the hobby expenses are no longer deductible.