Lemma Soft Forums

Not sure if this is the place to post this, but....

Anyway, I've been wanting to open up commissions either here or deviantART, and had a question. Now I know I do not need a seller's permit to sell online, however, would I need to report my earnings on commissions? From what I gather, it seems like no. I mean, commissions are not a steady income, and is literally an on-demand thing. But I just wanted to ask you guys about it to be sure before I do anything, since you guys are a lot more experienced with this kind of thing. I'd like to open up commissions soon so I can raise money to hopefully get more manga-making materials, as well as making a commercial VN someday, and saving up for the Artist Alley at cons and stuff. So yeah ^.^

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My Ren'Py novels:
Operation: Magic Hero (WIP)
Eileen's Otome Love Story
NekoCon! (HIATUS) (Update: 12/27/2011)


But dear God, You're the only North Star I would follow this far
Owl City "Galaxies"

You mean for tax purposes? Not unless you are making enough to actually have to pay tax in my country, but it will differ from country to country.

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The other 1/2 of Cyanide Tea l My Deviantart Account I My Tumber Account I Break Chance Memento I Ristorante Amore

Officially, any source of income is taxable if it goes over a certain amount, no matter how irregular the income is. In California I believe you can make up to $400 of income unrelated to your main job a year before you're supposed to report it. Definitely check out your state's/country's tax laws if you think you'll make a month's worth of rent doing this.

I'm not sure how extensively the IRS monitors Paypal, but I'm not taking my chances there.

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Finished:
- Zayay [Otome?][BxPlayer][NaNo 2013]
- Tortichki [Drag&Drop mini game]

Thanks for answering. I'm from California actually, and I'd be asking for the payments in either cash or MoneyOrder. I doubt I'd make over 400 dollars, but yeah, I should look into it (where should I go to look into it?)

I have sold at a con last year (Anime Expo AX). For the area, if you make under 100 dollars, you don't owe taxes (you still have to report your earnings, of course).

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My Ren'Py novels:
Operation: Magic Hero (WIP)
Eileen's Otome Love Story
NekoCon! (HIATUS) (Update: 12/27/2011)


But dear God, You're the only North Star I would follow this far
Owl City "Galaxies"

Careful with selling at cons as I know in least some states you can get in huge trouble if you do not submit sales tax. To combat this, some cons require that you submit a form with the state beforehand. Of course, like most other taxable things, it probably does depend on how much you actually make. I don't think they'd bother with taxing what you'd make holding a yard sale xD You know, I'm willing to bet that California actually has a tax information hotline that you can call toll free with questions like this if you want to be positive.

I wouldn't worry too much about them coming after you for tax fraud, but it probably is a good thing to pay your taxes properly if you can.

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http://tetiel.deviantart.com

In the US, you should probably report commissions as Miscellaneous Income on your tax forms.

(Same as you should report your income from bootlegging alcohol. You wouldn't want to end up like Al Capone.)

If you make enough money, you may want to file as a business, and report the income on Schedule C. That means that you can deduct expenses from the income. For example, if you buy a tablet for $100, and you then earn $100 in commission income to pay for it, those cancel out and you don't pay any taxes.

ANATA: I am not a Tax Advisor.

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"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face in marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming" - Theodore Roosevelt

I do not have a job, so how would I report commission income? And as far as the con goes, I did everything correctly for that, 'cause my friend who has sold there many times helped me and AX only required you to have a temporary seller's permit, and I reported all my stuff and was fine. Anyway, this question concerns commissions, 'cause in my opinion, selling at a con seems easier since I just have to report my earnings for the days I sold. Commissions? Yeah, I need to look into it. Plus, I heard there is something called Artist Exemption, so I should look into that if I may qualify.

I just want some advice and stuff before I begin doing paid commissions.

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My Ren'Py novels:
Operation: Magic Hero (WIP)
Eileen's Otome Love Story
NekoCon! (HIATUS) (Update: 12/27/2011)


But dear God, You're the only North Star I would follow this far
Owl City "Galaxies"

Commissions can be reported as miscellaneous income. (Like any other income that isn't reported on a W-2, 1099, or other form.)

If you have a lot of income and expenses, you can file a Schedule C, and report the commission income as business income. Surprise! You're currently the Sole Proprietor of a business. Everyone is - they just don't take advantage of that often. You report business income and deduct expenses. (The income you report this way is taxed at a higher rate, though - but it shows up on social security.)

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"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face in marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming" - Theodore Roosevelt

Ah, okay. Thanks everyone! I will of course, do more research myself, but this helps me a bit to know what to look for. ^.^

_________________
My Ren'Py novels:
Operation: Magic Hero (WIP)
Eileen's Otome Love Story
NekoCon! (HIATUS) (Update: 12/27/2011)


But dear God, You're the only North Star I would follow this far
Owl City "Galaxies"