As most of you know I've been hosting group breaks for a little while now and I'm having a great time doing them. However, me and my wife starting talking about it all the other day and realized how much money we've received through PayPal and Money Orders from all the breaks....from what we understand if you "earn" more than $500 a year from something you are supposed to report that to the IRS and pay taxes on it. Baring that information, this could be a problem. However, I usually end up losing a few bucks + the cost of buying me own spot when all is said and done. This is not by any means a profitable "business" that I am running.

I am wondering if anyone has any insight into this situation. I have anywhere from $400-$700 sent to me each time I do a group break....most of which is PayPal which can easily be tracked. My question is, does this fall into the category of monies "earned" throughout the year? Basically, I'm just providing a service to my members, and they are just sending in their share of the total payment to pay off the total price of the boxes. Does the IRS see it this way though, or would they just see that I've been "paid" $x dollar amount and be like "hold up, we want our taxes?"

If the IRS ever gets around to looking at Paypal accounts you might have to explain or show records of your costs vs. receipts. I would not think this would fall under business guidelines, since you are merely splitting the cost of a box of product among however many members and all you are doing is recovering the costs associated with that break. Now if it turns out you are making a profit doing said then you would probably have to pay taxes on the profit.

This is my opinion, not based on any laws, etc.

Yeah...what you said is how it SHOULD be viewed, because thats what it is. I'm a just recouping the costs of the money spent to purchase the products. I am only losing money when doing the breaks...I first of all have to pay for my own spot, and then on top of that I usually end up losing a few extra bucks when supplies and shipping is all said and done. I'm just wondering if that's how it would be view by the IRS, or if they'd simply see it as me being "paid" so much money.

my Brother works for the IRS so i will see what he says about this but i don't think you have to pay taxes cause i have brought in over $400-$500 in the last month just selling stuff so i may nave to pay taxes there since i am not doing box breaks it is strictly my money since they are straight up sales

That would be great if you could find out from him...just don't mention my name haha. Although, I'm pretty sure these posts I've made have already been monitored by the govt...seeing that I'm on the Belmont Campus wireless network right now and the secret service is well being the secret service leading up to the debate thats going to be here on Tuesday.