Tax question?

Question

When selling AVON, what are the requirements or earnings amount for having to claim the earnings on your income taxes?

Answer 1

Whether you make a profit or a loss on selling avon you need to report your activity. You would report the income and expense activity on a Schedule C on your 1040. If your Avon activity results in a net profit of over $400, you would be responsible for paying Self-Employment (SE) tax, unless you have already hit $97,500 (for 2007) in social security wages. Even if you hit that already you would stil be responsible for paying medicare tax, which would be 2.9% of 92.35% of the net schedule C profit. If you have less than $400 profit, or even a loss, there is no SE tax.

I have attached a link to self-employed persons.

You need to be careful though with a business on the side. If it does not make a profit for 3 out of 5 years, the irs can declare the business a "hobby" and disallow any losses for.

Answer 2

No minimum amount. All earnings have to be reported for income tax purposes. However, there is an amount for total earnings below which you are not required to file an income tax return. It varies, and it should be published in the instructions for filling out the tax return form.

Answer 3

You would be considered self-employed, so if you made more than $400 in a year, you'd have to file.

If you were already filing, either because you had other income or because you were filing a joint return, then you'd have to claim all income from the first dollar.

Answer 4

$400 per year if it is your only income.....or...

(Technically) $1, if you are already over the filing requirement due to another income or spouses income.