-BLOGGERS MAY OWE TAX FROM BLOGGING
Blogging may increase your taxes, and you need to know how to report it.. If you have advertisements on your blog, and they get a lot of clicks, you may have received a payment for the ads. Not me! I didn’t have enough response to the ads on my blog in 2006 to get a check. Maybe I would have received a few bucks if I’d started before December 2006.
Some bloggers, though, would have generated enough in advertising revenue to receive payments for their blogging. A friend of my daugher’s has a blog called BAG SNOB and has raked in several thousand dollars from the ads. This money is not tax-free. Even if you make less than $1.00 per hour for the time you spend blogging, you can’t hide it from Uncle Sam if you receive a Form 1099-MISC reporting how much you made from the ads on your blog.
These 1099 forms are required if you make $600 or more, but they can be issued if your earn less than $600. Some payers find it easier to prepare them for everyone rather than checking to see if you made enough to require issuing a 1099.
Your income from blogging would be non-employee compensation which means you may owe income tax and self-employment tax on it. You would not owe the social security portion of the self-employment tax if your wages and other earnings are more than the social security maximum which was $94,200 in 2006.
If you make over $400 as a blogger you are subject to self-employment tax. The medicare portion of the self-employment tax is 2.9% (you pay half of that as your employEE share as your own employee, and the other half as your own employER—so it’s double the rate you would have deducted from a pay check). If you haven’t maxed out on social security you would have to pay another 12.4% for social security. On top of that, you would pay income tax based on your tax bracket.
Your income from blogging should be reported on Schedule C. You can deduct any expenses related to this income. If you made over $400, you would also need to file a Form SE for self-employment tax.
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This information is not intended to be advice to the recipient. In compliance with Treasury Department Circular 230, unless stated to the contrary, any Federal Tax advice contained in this Blog was not intended or written to be used and cannot be used for the purposes of avoiding penalties.