Thanks. This is terrific. In regular business, if you pay someone more than $600, (like a freelancer or contractor) you're required to send them a 1099 form. So I would imagine products that fall below that amount would avoid the IRS requirement...
You're welcome! Just keep in mind that regardless of the situation, even if you do not receive a 1099 form, you should still report the income on your taxes. For those on benefits, the $600 1099 rule is helpful because it means smaller amounts of income below this limit are less likely to affect their benefits. Be sure to consult with a tax advisor for specific advice.
Yeah, that's not how that works. It's accumulative. So if you get paid with 60 $10 items. They will send the 1099 with the $600 amount shown. It's not per item.
If you are a business, you are required to self-report regardless. I'd definitely check with your tax advisor. I don't think Amazon sends a 1099 if it is under $600.
Do you have to save money for the taxes? I keep seeing people saying that and given how it's quickly approaching xmas I'm worried on saving for the upcaming tax season and getting gifts
I just got the invitation today and figured what the heck I might as well. I’m glad I stumbled on your video. I’m on disability with very limited income. Do you by chance know the max dollar amount I should stay under? Will they kick people out if they don’t do a certain number of products? Thanks for your valuable information.
Glad you found my video. I’ll have to do a video explaining that. But, The max dollar you should stay under depends on how much money will get you kicked off of your disability. Try to review products with a zero tax dollar amount. Even though you don’t pay for the products outright, if you have a gross dollar value of let’s say $2,500, you have to claim that as income you made on your taxes.
@@creativestudio-101 Hi, It is true that 0.00 items you purchase can change at a later date and an amount put on to your taxable figure, or in your experience has this never happened and 0.00 items stay as 0.00 throughout.
Good information. So my take away from this is when starting out (I just got my invite to Vine), I should start out ordering 0ETV items to get a feel for the program? Also, and this is probably a dumb question, but you will get taxed a percentage of the ETV amount you have like on a pay check, and not that full amount?
Congratulations and welcome to the Vine Program! Don't hesitate to ask questions; there are no dumb questions. To start, it's a good idea to begin with 0ETV items to get a feel for the program without impacting your taxes. Regarding the tax implications: you are not taxed a specific percentage of the ETV amount like on a paycheck. Instead, if you receive $5,000 worth of merchandise, it's treated as $5,000 in cash. This amount is added to your taxable income. For example, if your regular salary is $50,000 a year, and you receive $5,000 in merchandise, your taxable income becomes $55,000. The tax you owe will depend on your tax bracket and how much additional income you have received.
I've been always curious about this vine program i see the reviews and say how did they get that free hehe. My question is ok you get $800 in product from vine that is taxable value, at year end what is the amount you actually pay like 15% of that in taxes?
If the value of the products you receive is $800, you would indeed include this as additional income on your tax return. The actual amount of tax you would pay on this income depends on your total income and your tax bracket. For example, if you're in the 15% tax bracket, you would owe approximately $120 in taxes for the $800 of products received. However, it's important to consider all aspects of your financial situation when calculating your taxes. Other deductions or credits you're eligible for could affect your overall tax liability. It might be helpful to consult with a tax professional or use reputable tax software to get a more precise estimate based on your specific circumstances.
How about the 0.00 etv tax items like consumables etc, I am told even with these being 0.00 on your tax bill, you must declare and in Germany even these occur a 7% tax charge. Is this the case in the US? I am unsure if it's even true about Germany as 0.00 is 0.00 surely
Great question! Unfortunately, products received for review are considered taxable income, not something you can write off. Since you're receiving them in exchange for your review, they must be reported as part of your income, similar to payment in goods rather than cash.
For folks who are tax noobs, your actual tax obligation will be no more than your marginal tax rate. That can be as low as 0% or as high as 35% (if you're making over $250k per year). That will make your tax on those $130 headsets anywhere from zero to $45. Still quite a bargain as long as you're only ordering what you need. If you're just ordering to satisfy your shopping itch you may get burnt.
Hey @mfuchs2004, thanks for chiming in! You’re absolutely right-if you're only grabbing what you need, the tax impact might not be as bad. But, like you said, it's all about knowing your marginal tax rate and being smart with your orders. The real risk comes when people order things they don’t really need or just want to satisfy that shopping itch. That’s when the value starts to drop, and you could end up with a product that doesn’t live up to its price (especially after taxes). Appreciate your insights!
I thought I heard you say you'll get a 1099 with $5000 of estimated value, where did you get that info? You'll get a 1099 on anything anything over $600, not $5000. That would be Amazon's total; so you'll get one per year from Amazon. However, some of the other things you mentioned as in putting you in a higher tax bracket could have really bad implications with many organizations, including the IRS. TY
It seems I might have caused some confusion with my earlier comment. I mentioned that spending $5,000 could impact your tax return, but this isn't directly related to receiving a 1099. You’re correct that a 1099 is issued for amounts over $600. Thanks for clarifying that and for your input on the tax implications.
