The $600 you hear about is the threshold for Amazon to have to send you a tax reporting document. Then, there is a separate threshold for the requirement to report your self-employment income. That is $400 of net income, or your income after expenses. While there aren't a lot of expense items for Amazon Vine participants, there are some.
You may be able to claim, for example, the costs of things required to test certain products. For example, if you get a bread machine on Amazon Vine (the one thing I can't seem to find there myself!) then you might be able to claim the costs of ingredients used to bake your first loaf of bread in it so that you can properly test it. You may be able to deduct a portion of your internet related to the time you spend writing your reviews, or a camera if you're doing videos as part of those rules. Those are just a few examples.
Your net income, then, is the difference between the value of the items reported as sent to you by Amazon and your expenses. When this amount exceeds $400, you must file a return.
As a general rule, with no other taxable income, you can expect to owe approximately 15%-25% on the value of your Vine items received if you are filing reporting them as self-employed income (which is generally the proper way for most participants.) The reason for this is that you are performing contract work in the form of providing a service (your review) in exchange for something of value.
If you receive just $600 of items with taxable value from Vine this year, you could expect to owe around $95 of tax. You would be subject to self-employment tax, but no income tax since your Standard Deduction would be greater than the income declared. That is assuming that you had no deductions against that $600 of income.
Keep in mind that some things, such as medical and wellness products, will have a $0 taxable value to you. So, if you do find things like medical equipment, certain beauty products or a bag of tea, there's a chance that you will owe no tax on those "$0ETV" items.
The Vine page will show you before you order what the ETV will be and you can check your total regularly under "My Account" on the Vine page. You can also download a spreadsheet with detail in that same area of the Vine program.
Many participants specifically focus on the categories where the $0 value items are most likely to be: Health & Household, Beauty & Personal Care, and Grocery & Gourmet Food (all under the "additional items" tab) and manage to keep their tax bills minimal through the year and still enjoy the program.
Items like clothing and shoes will be taxable income to you. However, if you are only ordering items in the same quantity as you would otherwise, then your total out-of-pocket expense for these items will be less than if you paid for them outright usually.
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