Amazon Viner and adjusting 1099 etv value
Been going through the posts regarding adjusting the etv (estimated tax value) and 1099nec that Amazon sends us for reviewing products. We make no money off this by simply reviewing, but we're still sent a 10099nec due to the bartering we're doing. I've seen some articles answering this question saying:
1. The 1099 NEC should be reported in full on Schedule C.
2. You do not change the 1099 amount itself.
3. The products received can be reported as a corresponding business expense, such as Supplies or Cost of Goods Sold, which can offset the Vine income. (For example, $20,000 of 1099 income with $20,000 of qualifying product expenses would result in $0 Schedule C profit.)
4. Damaged, worthless, or overvalued products can also be addressed with an appropriate adjustment expense.
5. Products that are actually sold are reported as sales, with their corresponding cost deducted as an expense.
The only part im confused on would be that point number 3 feels like it conflicts with 4. If I can write it all off as a business expense of supplies or COG, why would I adjust it to anything else other than full value? This makes me feel like there's some of flicting or missing info Im not seeing.
Answers
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I wanted to add that I do feel like all of it can be written off as an expense bc that's how much it cost me to purchase the item for reviewing it. If I don't need to purchase it to review it, I wouldn't have done so. If I wasn't reviewing it at all, I would never have purchased it. The only way I see me not including it as a business expense is if I was going to buy that specific item from that specific seller, vine program in exsistance or not. If it's something I'm going to use anyways, then I could see reporting full value or maybe adjusted, but again the purpose is to review it so expense seems logical to me.
Trying to find someone to prove me wrong here lol
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What happens to the products? You cannot write off business property that you convert to personal use. You can only expense the entire amount if you sell it or use it for ordinary and necessary business purposes.
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Many product are used up while testing. Some are just sitting in a stock pile awaiting to be given away because even though Amazon says all rights transfer to us upon transfer to delivery, and that we are free to destroy it, it also says we cannot sell or give away any products until 6 months after receipt. To me the products in getting are literally used necessary business purposes (aka supplies/to review them). For 99% of them, if I weren't reviewing the product I wouldn't have selected it. We are only allowed to pick from the items available.
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Hi Viner,
Thanks for joining our Community and posting your question.
You might like to read this article on product review income (from Amazon and others) we posted earlier this year.
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That one is one of the ones I was talking about
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Yes that article is one of the ones I was referring to that confused me. In the expenses section it mentions over inflated items one time, but then goes on to talk about and show examples of other circumstances (like damaged goods) but no over inflation. Also doesnt address listing the items as supplies/expenses aa on of the other posta on this site speaks about. I seem to not be able to find a direct answer anywhere about if I am 1) allowed to adjust for over inflation, and 2) can I list all the items as a necessary business expense since the business is to review the product (no product = no reviewing = no 1099nec).
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Hello Viner,
The product sellers are going to give you the full retail price so they can expense as much as they can. You can create a business expense to adjust the reported value compared to the actual value. See the article and the spreadsheet for the reported value and actual value. Yes, you can adjust your inventory value based on the decrease or adjustment to the value.
Listing the product as a business expense is possible, however if you sell it, you can't expense the value twice. Also, if you convert it to personal use, you have to show that you paid yourself.0 -
This has been discussed ad nauseum in Vine reddits, etc. Fellow Viner here. We all know that the value the maker sets is often wrong because it is useless junk, especially after it has been used. Many people try to give what they believe to be fair market value and reduce the cost. Maybe that's ok, but there still doesn't seem to be a definitive answer. The answer you don't want to hear but the only one that is safe and guaranteed not to cause issues down the road is that the moment you hit the "Request Product" you are accepting the ETV and agreeing contractually to review it at that value. What you do with it afterwards, and whether they discount it significantly with a coupon later is irrelevant. You "bought" it and agreed to the price for your services. I don't see how it is a business expense. It is your business. You are taking that value in exchange for your review. Your claim that "if I weren't reviewing the product I wouldn't have selected it" has no bearing. You chose to review it, you selected it, and you chose to do so at the posted wage, the ETV. I don't see how one can deduct wages as business expenses. I wish it were otherwise because my enthusiasm for the program has quickly waned, especially as I get close to retirement when the extra couple thousand I "earn" can push me into additional costs and taxes that really are not worth it. So far I have only filed as hobby because I don't want to incur any other hassle wondering if I also have to pay FICA, etc.
I would love to be wrong on this. Have not done any recent research into how folks have been (successfully) trying to skirt the taxes, as I do know that it is still somewhat gray even for tax specialists.
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