Taxes on an internet business with no profit?
srgunmas asked:
As a side job, I run an internet site. Eventually, I hope to have everything funded through donations, but until then everything has come out of my own pocket.
As a side job, I run an internet site. Eventually, I hope to have everything funded through donations, but until then everything has come out of my own pocket.
In any event, I didn’t make a profit off of this site, but was curious if I still have to pay taxes on it. I’m also interested in whether or not running the site would qualify me for small business tax benefits.
August 1st, 2009 at 7:00 am
This hobby is just that a hobby.
Income goes on 1040, line 21.
Expenses, up to the income, goes on schedule A as a miscellaneous expense.
August 4th, 2009 at 2:44 pm
Since you do not intend to ever make a profit, it is a hobby, not a business. Therefore, you get no tax benefit.
If you do make a profit, you must pay tax on it.
Because you have no profit, you owe no income tax.
However, you may owe other taxes, especially if you have employees. If you have employees, you must pay social security, FUTA, etc.
Also, you may be required by state or local law to collect sales taxes from your customers and transmit that money to the state or local government.
August 7th, 2009 at 3:43 am
if you need help, go to
You are advanced up to $1,000,000 based on your current sales receipts. A small percentage is deducted from your ongoing Visa/Master Card/AMEX & DISCOVER receipts. There are no fixed payments and no fixed term time frame.