Q: Money Makers and Tax

cid681
310
Hi,

I'm new at using Money Makers on dealspl.us and was wondering at what amount would we be required to declare on our taxes at the end of the year? Does it go in to the miscellaneous section of the tax form?

Thanks.
cid681 posted Jan 15, 2013
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21 Comments
dealwagger
Have you had to submit a W9 form to dealsplus? Otherwise you may not even be required to file, but I would check with an accountant to be certain.
dealwagger (rep: 10.2k) posted Jan 15, 2013
00
cid681
A W9 as though I were an employee?
cid681 (rep: 1.03k) posted Jan 15, 2013
10
nimase85
You only need to fill out a W9 if you make over $600 a year

"How do I receive my Money Makers payments?
At the end of each month, we will calculate your total Money Makers earnings. If you have made $25 or more since your last payment, we will deposit your earnings into your PayPal account. If you have not yet made $25, we will hold your earnings until the next pay period during which you have accumulated $25 or more. Please keep in mind that it may take up to 30 days for the deposit to appear in your account. Also note that if you make over $600 for the year, you'll need to send a W-9 to info@dealspl.us or fax it to (609) 543-0968"

http://dealspl.us/account/faq_mm.php
nimase85 (rep: 15.7k) posted Jan 15, 2013
40
bbattag
@nimase85 is correct. As soon as you go over $600, you need to email or fax a W9 form to DP. You will not receive any additional payments until you send the form in.

If you are under $600, you don't need to submit a W9
bbattag (rep: 6.76k) posted Jan 15, 2013
10
arsiel
Follow up question (probably for mods):
Do we get a W2 tax document mailed to us to file stating our income for the year if we originally filed a W9?
arsiel (rep: 13k) posted Jan 15, 2013
20
cid681
This is all great info, I'm very glad I asked and thanks so much for the clarification!
cid681 (rep: 1.03k) posted Jan 15, 2013
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alecupope
I think you should be concerned about this after you make some serious money :D
alecupope (rep: 15.1k) posted Jan 16, 2013
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DealLeader
These days you have to claim any income source when you make more than $600. Got to feed the government's habit.
DealLeader (rep: 7.68k) posted Jan 16, 2013
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gangstabarbie
$600
gangstabarbie (rep: 9.67k) posted Jan 16, 2013
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helloamy1977
what if you made $550 on here and $100 on another site similiar to this?
helloamy1977 (rep: 2.53k) posted Jan 16, 2013
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munkin2u
I think you get a 1099 not a W2. The 1099 verifies you as an independent contractor, not an employee. But I've not made close to the minimum to file here lol.
munkin2u (rep: 1.26k) posted Jan 16, 2013
10
munkin2u
@helloamy1977 I'm pretty sure they're considered as two separate companies, so a W9 would only need to be filed if you made $600 with one company alone. I sometimes write for another site and have run into a similar sitch ... where be the mods on this?
munkin2u (rep: 1.26k) posted Jan 16, 2013
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kffight3r
For some reason I read Monkey Makers....I need to sleep more
kffight3r (rep: 712) posted Jan 16, 2013
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xptrish
Haha kffight3r,that must explain my craving for bananas! Lol
xptrish (rep: 71.1k) posted Jan 16, 2013
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arsiel
Thanks munkin2u. So.. I guess the question is now of we get a 1099 to file.
arsiel (rep: 13k) posted Jan 16, 2013
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fluffy
Taxpayers are legally required to report every last cent of their income, no matter how small. However, the only way the IRS normally knows about your earnings is through their mandatory reporting requirements on payers. Since the IRS doesn't have the capacity to deal with the amount of data they would receive if everyone paying anyone had to report every last cent, they set reporting thresholds for different types of payments. Banks, for instance, must report interest payments of $10 and up. General payments to non-corporate entities such as an individual have the $600 reporting requirement threshold.

That doesn't mean you're not legally required to report your less-than-$600 earnings on your tax return. It just means that the IRS won't have any direct knowledge of the payment. When you get a 1099 or W2, the IRS automatically gets a copy from the payer. In most cases, it come to them digitally, so their computers are ready to match up these statements with your tax return.

So if you don't report your income below the reporting threshold because you didn't get a 1099 form, there is very little chance that anything will come of it, but you are in fact breaking the law if you don't report all of your income. If for any reason you get audited by the IRS in the future, even for matters completely unrelated to your MM earnings, the presence of these transfers to your bank account might be discovered and create a problem you wish you never had. There's not a big chance of that. I'm just letting you know that there's a difference between what's legally required and what people commonly get away with.

I am not a lawyer or a professional tax preparer, but I owned a small business for some years, and I had lots of long, mind-numbing conversations with my professional tax preparer, and a lot of this has been etched in my memory.

I distinctly remember him telling me that the IRS requirement to report payments to any non-corporate entity over $600 not only applies to business payers, but to individual payers as well as well. That means that if you or I pay an unincorporated plumber, carpenter, auto mechanic etc, a total of $600 or more in a year, we are legally required to send that info to both the IRS and the recipient on a Form 1099! Obviously, we never hear of taxpayers being busted for this. Again, I suspect that it only becomes a problem if you somehow manage to draw undue attention from the IRS.

Even though a payer isn't REQUIRED to report your earnings below the mandated reporting threshold, that doesn't mean they can't VOLUNTARILY report it anyway. I once had a bank that did me that favor. Whenever you receive a 1099 or W2, that means that the IRS already has this info in their computers. Not accounting for it on your tax return is asking for trouble.

In most cases, income you earn on a 1099 would have to be reported as Self-Employment Income on Form 1040 Schedule C. You would also have to calculate and pay Self-Employment Tax on Schedule SE. You would not be able to use the short 1040 forms. If you use a professional tax preparer, you will be charged extra to complete these two additional forms.
fluffy (rep: 2.17k) posted Jan 17, 2013
50
alecupope
designing the new MM page I think you'll need to enter the info directly here on the site and not needing to send a form by email or fax.
alecupope (rep: 15.1k) posted Jan 17, 2013
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rd995
good information there fluffy thanks
rd995 (rep: 106k) posted Jan 17, 2013
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cid681
@fluffy Definitely seems like the most reasonable information so far.

Also will be asking the accountant when I go in to get my taxes done.
cid681 (rep: 1.03k) posted Jan 17, 2013
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corockies17
thanks for the information fluffy that's good to know.
corockies17 (rep: 208) posted Jan 20, 2013
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bellaBG
@nimase85 thank you for the information, good to know.
bellaBG (rep: 42) posted Feb 04, 2013
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