Question

Stock Photography - Hobby Income or Business?

Forum|Forum|2 years ago
August 30, 2023
1 reply
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I am interested in selling photos online through stock photography agencies. To me this is just a hobby and I anticipate the income to be low and not something I would ever depend on. I already have a full-time career.

Would I claim income from stock photography as hobby income on my taxes, since that is what it is to me? Or would the IRS declare this to be a business in spite of how I see it and operate? At least one agency I know of sends contributors with earnings a 1099-MISC every year.

Given that a business usually requires the payment of regular income taxes plus self-employment taxes, I want to be sure I don't later have a problem because I didn't file correctly and pay everything required.

Ask the Experts - Self-Employed - Aug 2023

K

Katie-P

Hi @David_R7!

Thanks for participating in our Ask the Experts Event today! I'm happy to help you.

You are spot on with your questions about hobby income vs. self-employment income. The determination can be confusing. I'm highlighting a few points below:

The IRS says here that the bottom line is whether the business operates to make a profit. If you are in it to make money, it's not a hobby.
If it's hobby income, you just pay income taxes on the INCOME. You can't take any deductions against that income. Reference this article.
If it's self-employment income, you pay income taxes on the NET INCOME and self-employment taxes on the NET INCOME as well.
Here are more articles that may help you with this determination: