If i get a job but most of my income is from my business, will i still have to file as self employed?

Question

Im 16, ill be making more than 10k this year from selling computers and such over ebay... but i dont want to file as self employed and have to pay all those social security taxes and all that stuff....

So if i get a job and still make less at the job than by myself would i still have to file as self employed?

Answer 1

Any income from job (wages) is reported on line 7 of Form 1040 (wages, salaries, tips,etc).

Income from ebay is self employment income and is reported on line 12 of Form 1040 (Business income or loss). For this you complete schedule C or C-EZ (Form 1040), where you report your income and expenses to arrive at your net income or loss from business.

Thus on your tax return you must report all types of income.

Answer 2

Since the only way you are supposed to be selling on eBay is if one of your parent's is supervising you, you might wan to ask them how a tax return works. (You have to be 18 to sign a contract.)

When you fill out a 1040, wages go on line 7 and self-employment income goes first to schedule C and then to line 12. Your $10K in sales is definitely SE income.

When you do the schedule C to report your eBay income, you will start by listing *all* of the money you received. Then you will reduce this by the amount of the expenses you can both document and are allowed to take. (Going to a seminar like eBay Live won't cut it as an expense.) If you didn't save receipts, you will be in a world of hurt. Being able to claim eBay fees, Paypal fees will be easy (just print your account history), but you need to show what you paid for inventory, postage, packaging supplies, a log book if you hope to claim milage to the post office, etc.

If the net income is $400 and over, you *will* owe SE Tax. The 12.9% FICA tax stops being charged when your combined income from wages and SE income is over $90,000 (a number most American fantasize about). The 2.9% medicare tax has no cap.

Answer 3

Your wages as an employee are regular taxed, but you'd still have a schedule for your home business.

And yes, you have to pay those taxes, so maybe now you'll look at the prices you charge and figure in the 16% social security, 4.2% federal unemployment, 8% medicaid et al.

On the flip side, if you take vacations to learn about how to sell on ebay, you get to write those off, so you may have lots of losses (like car depreciation expense driving around picking up old computers to hack and re-sell). You'd be surprised how much you can write off legitimately - basically all of your costs of doing business (cell phone, gas). It's not a bad way to go.

Answer 4

Yes, having another job doesn't change anything about filing your self-employment income.

Answer 5

You would have to report you ebay profits and wages.