Hello "jdrue"
In an earlier message you asked..."There has to be a way to simply claim the income the same way you would if you just sold some things on ebay or a rummage sale. Any tips around this?"
I have a friend who just started a small home based business, and she told me about the hobby vs. business aspect of doing her taxes.
Since you're just getting started, you could claim your income from your endeavor as a hobby, but you can deduct the total hobbby expenses only to to the extent of income that you receive.
There are rules for determining if something is a business of hobby, and I think you can get away with the hobby idea for now. You may want to check it all out on the IRS website.
www.irs.gov
I also checked some other websites, and here are some tidbits of information that I found so far:
A hobby is an activity with an element of personal pleasure and no motive for profit. From a tax standpoint, hobby income is of minor consequence because the deduction of losses is limited to income. The IRS presumes an activity is a business if a profit was made in three of the last five years, including the current year.
Hobby income is reported on Form 1040, line 21. (other income line) The total income is reported, without any deduction for expenses. Hobby expenses are deducted on the appropriate lines of Schedule A. (If you itemized deductions) There is no self-employment tax on hobby income. It's taxed like the rest of your income.
The Form 1040 instructions do not specify a specific marginal entry to use. The standard is to write “hobby income” rather than naming the hobby. This will indicate that you are applying the hobby rules to this income and associated expenses.
I'm sure all of this will give you something to think about.
Rose