Question

Self Employment Income

Forum|Forum|5 years ago
March 14, 2021
1 reply
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Hi,

I have a Videography business that was mostly inactive during 2020 and in order to qualify for my state's EITC I need to establish at least $1 in earned income. I sold a camera lens on Ebay at the end of the year. I saw a profit from its recent appraisal earlier in 2020 (sometime in the Fall.) I also refurbished the lens in between the two events. Will the profit amount count as earned income under self employment?

Thanks.

E

ErnieS0

No. Even if you used the camera lens as part of your photography business, the profit from the sale will be reported as the sale of a business asset and not as earned income (sales and earned income are reported on two different forms).

Since it is not earned income, it will not come under self-employment.

If you refurbished the lens, you can add the cost (if you paid someone) to the purchase price to reduce profit from the sale of the lens (sale price – (purchase price + refurbishment costs) = profit/loss. If you did the work yourself, you cannot claim a value for your time.

If you previously wrote off the lens off as an expense or depreciated it, subtract those amounts from your purchase price since you already claimed a deduction for that portion.

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