Important question pertaining to taxes and online earnings!

I think a general rule of thumb is that if you receive a W-2 or a 1099 form from a payer, you need to report the income because it has been reported to the IRS. Payers need to provide you with an income statement if they are reporting the income to the IRS. One thing to also consider, did you give your social security number to any of these websites? If not, you don't have to report the income because the site has no way of reporting the income to the IRS and matching it to you. Of course, if you want to be a good citizen, you can report the income and pay taxes on it.

You have to pay if you make more than $600 from an individual, or an individual site. I learned this from working MTurk. I use that to make money for Christmas, and I try to keep it under $600 a year. I got so caught up in it this past year that I made over $600. I started to worry because I didn't put back any money in case I had to pay in. Come to find out I was able to make over $600 because I worked for many different employers. As long as I didn't make $600 from an individual employer, I was fine. Now if I make $600 on this site, I would have to pay in because this is one employer. Some things to keep in mind is the write offs that your allowed to take off those earnings at tax time. My accountant told me that if I ever make over $600 I should put back 25% of how much I made total. She advised to put it in a savings account so that it could grow interest over the year. At tax time she is allowed to write off internet expense, computer expense, and an expense from some of my bills for a home office. Since my income would be made online I can count a home office, even if I sit in my living room while working. Then if I have to pay anything in, I have the 25% saved up to make any payments. She stated that chances are I would never have to use that whole 25%, but having the extra money with the interest built up will make a good return.

I am not in US and I don't know how taxes work there but I wanted you to see this discussion posted by admin: http://www.mylot.com/w/discussions/2067952.aspx It might relate to your query in some way (from the second point onwards).

In my understanding with taxes we don't pay taxes from getting online income that less $600 from one site. said you make $200 from inbox dollar, $200 from mylot and $200 from clixsence, you don't have to pay taxes because even though they are $600 added up but they don't come from the same address. Another concern is our activity online is not tax deductible unless it's registered as business as sample you have online store make $600 then it's tax deductible or you have dating site make over $600 it is also tax deductible.

I had this same question so I'm glad you posted it. Even though most of the sites I'm on I don't think I'll ever make over $600 a year, there is a few I think that I possibly could make over $600. However I think when I start school again in August how much I earn daily/weekly/monthly could drop since I won't have as much time to spend online.