Is it required to include the money received for a service performed for less than $10 on your taxes?

Question

I read something about this last year. A tax law, from an unknown source, stated that if you receive less than $10 for a service performed, you do not have to include the money received in your income. Is this true? If it is, could I please have a reference. Thank you.

Answer 1

Technically, if you receive one cent in income, you have to report it (although the IRS does allow you to round to the nearest dollar, so one cent would be rounded to zero). The question really is whether the IRS will receive notification from the payor whether you received the money or not. The $600 limit mention is for the reporting requirement on the Form 1099-MISC. If a payor has paid more than $600 for products or services with a vendor over the course of the year, the payor is required to file a 1099-MISC showing the total payments throughout the year. When the form is filed, a copy is sent to the IRS so the IRS will then know that this vendor has received $X from the payor. The IRS will then match that against the revenues reported by the vendor on their taxes.

Answer 2

There is no such law. You have to report every dollar you made to the IRS whether you received W-2, 1099 or whatever documents.

If you made money from tips that is less than $20/months, you are not required to report to your employers. However, you still have to keep track of your tips and report at the end of the year.

Best wishes.

Answer 3

There is no such law.

If your interest income from a bank account is under $10, they do not have to send you a 1099. You are still obligated to report the income though.

Answer 4

If you receive less than $600.00 you do not have to report it.

Most companies or individuals will not and are not required to file a 1099 unless the income is more than $600.