Is Your Etsy Shop a Hobby or a Business? How to Report It, 1099-K Included
Etsy income is taxable at any size. A business reports on Schedule C, deducts Etsy fees, materials and labels, and pays 15.3% SE tax on profit of $400 or more; hobby income goes in full on Schedule 1 with no expense deductions. Etsy's 1099-K includes shipping but excludes the sales tax Etsy collected.
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