I know that there are quite a few bloggers on here so I thought I would post this for you guys. Paying Google Adsense taxes If you’re blogger or web publisher who uses Google Adsense to earn a few extra bucks, this April income tax is due on your earnings. Web site Adsense Taxes has advice and tips for dealing with ad revenue income tax. Google Adsense™ income is business income. Since you are getting paid via a 1099-MISC, which means Google is treating you as an independent contractor, the U.S. Government has decided that income is taxable. More importantly, Google will be reporting your income to the IRS as one of their expenses. Just like Google is reporting paying you as an expense, you need to be keeping track of every expense that you can. Just bought a new domain name? Save your receipt! Log onto your Adsense account to retrieve your tax documents from Google. http://www.lifehacker.com/software/tax-time/paying-google-adsense-taxes-153218.php
It was just a matter of time until the government would figure out how to tax internet ad revenue like that.
Given that the IRS definition of gross income is "all income from whatever source derived" I would say they were licking their chops when people started selling ad space...
Exactly. If Cluth owned a billboard and someone paid him to put an ad for their company on there, it would be considered income no?
Curses.... The G-men found out about Clutch's lucrative BBS hosting racket... (does this mean he can write-off his Rocket's tickets??)
Probably just conjecture but that could also mean that he could say that the BBS is a small business and start writing off all kinds of stuff. He is probably still taking a loss on this little playground we enjoy...
Does Clutch have to pay taxes on it, even if all of that revenue goes towards site maintenance and server costs? I think that would count as non profit...
Clutch is a smart man, and I imagine he has already done that. You don't even have to consider it a "small business" to write off costs to run it. It is suplimental income that they send you a 1099 for, and any money that you spend to EARN money with a 1099. I make money via internet ventures of all kinds (about 10 small checks a month including adsense) and if you make 1 dollar on the stuff you can still write off your 5000 dollars in expenses... so making ANY kind of money off of websites such as this even for a loss can be to your benefit simply because of the tax deductions you can use.
Ad revenue, like all other business revenues, have been taxed since the internet began. It's income. The Google thing is the same as it has always been for the few years Google AdSense has been around.
It can't be considered non-profit, there are specific guidelines you have to pass to be considered non-profit0. If he operates at a loss he can use the tax deductions to help ease that lose or actually gain him tax benefits (see returns).
Correct, ANYTIME you make money via companies on the internet they ask for either your SS# or TaxID# and they send you a 1099 form at the end of the year. I received my 1099's from Google, CafePress and Commission Junction in the last couple of days.
But I think a business can only operate at a loss for a certain amount of time before it becomes a "hobby" for IRS purposes.
I'm fairly certain that this board doesn't run at a loss... I doubt it makes him major bucks but AdSense revenue just for page views is pretty good, and this place gets an amazing amount of page views. I make $100 a month on one website just on google AdSense ads, and that site is much smaller but I still move over 100GB of bandwidth a month.. and that MORE then covers my bandwidth and hosting costs. This doesn't include other "Pay for Click" adds that are incorporated into the website and contributions from members. Again, I'm not even pretending to think that he makes income off of the site but I'm fairly certain he doesn't do it for a loss.
BTW, I wanted to just apologize up front if I am dippin into yo' bizniz Clutch. Just thought all the bloggers should be aware.
