Taxpayer asks:

Thanks for taking my question! I wanted to say that I appreciate your blog, I find it easy to read and understand. I also like how you talk about your children as though they’re a real part of your life instead of accessories. That’s very refreshing to see online.

That brings me to my question. I have been trying to have a child for two years. It has been frustrating and expensive. Last year, as therapy, I started blogging about my journey. I was encouraged to find that there were other women out there interested in my story. At the end of the year, I realized that I had actually made a little bit of money during the year from small ads. It was not much (about $400) but enough that I think I need to report it on my taxes. My question is where?

Taxgirl says:

Congrats on your success! That’s great to hear and I am glad that you have been able to turn your personal struggle into something positive.

Report your income on line 21 of your form 1040 as “other income.” It sounds like you’re doing this as a hobby and not as a business, so you would not need to file a Schedule C. If it turns into a business, you’d file a Schedule C – more on this distinction in a post later today. But for now, I feel comfortable that you’re treating this as a hobby so you’d report your income on line 21.

You didn’t mention any blog-related expenses, so I’m not sure that you have any. If you do have blog-related expenses for your blog (such as web hosting), you could report those on Schedule A as miscellaneous itemized deductions; those deductions would be subject to the 2% of AGI limitations (more on this in a later post, too). You can report expenses up to – but not more than – the amount of your hobby income. You may not claim a loss (meaning more expenses than income) for a hobby.

Before you go: be sure to read my disclaimer. Remember, I’m a lawyer and we love disclaimers.
If you have a question, here’s how to Ask The Taxgirl.

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Kelly Phillips Erb is a tax attorney, tax writer, and podcaster.

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