Google Adsense, should I be putting away a % for taxes? I've had adsense up for 3 years but have only started making money the past 3 months. I've never gotten any notification to pay taxes on it, am I ok? If I don't reach a certain thresh-hold, should I not expect a 4,000 $ tax from the IRS some day or something?
All Income is taxable unless you have a reason why it shouldn't be taxed. You can do write offs (I think they are called) that will cut down the taxes I believe. I'd ask HR block because they know how to do it. Some things you can't do because it has to fall under a business, but many people do write offs for losses nonetheless. https://www.google.com/adsense/static/en_US/TaxInfo.html?gsessionid=4wxEEyO6f8r3N0WRbr1xVA
I think I am going to look into making it a business so I can write stuff off. If I were to purchase another site, could that be written off as an expense to the business? Apparently you can write off hosting fees, domain, etc.
You have to write of a substanal amount before it could become worth while. The irs already gives you certain deductions, and your write off would have to surpass their standard deductions before it will even be effective or worthwhile.
Its not taken out, thats why they have you fill a 1099, take out about 20% and save it, because even if you chose not to report it, Google will be reporting every penny they paid out and the IRS will keep your next income check if you are due anything or worse if you owe them. Pay uncle Sam his cut, and he will leave you alone... Don't pay him, and he will be on you like white on rice... Also the more you write off, the higher the chance of a tax audit gets... I always claim every penny I make online, Don't even report the refunds I give out, or fake chargebacks I always overpay. The way I see it if uncle sam is happy, i'm happy...No need to register as a business, anytime you get a 1099 you are considered sub contractor and classified as a business and pay taxes as a business.
Yup.... making income on the net is taxable. Depending on the government, it isn't hard to avoid but it surely is illegal not not to pay it since it is a form of income.
It's gross taxable income. On the other hand, if you have websites with commercial advertising like Adsense, that is generally a business giving you certain deductions. You may or may not have net taxable income from your business.