I own a site and I have people send me $20 via PayPal to get an email account. I earn about $500 per month in my business account. If the money is in the account, do I have to pay income tax on it? What if I request the $2000+ balance to be mailed by check, then do I owe income tax? Thanks in advanced!

Yes, you pay taxes on all your recorded revenue, unless you can write it out on something else like business supplies.

Put another way, yes you have to pay taxes on the income, and (somewhat unrelated) yes, you can deduct various business expenses.

Now, if I don't have my credit card or bank account in the account, and I haven't told it my SSN, are they going to search me out if I don't pay taxes. When I stop selling email accounts which will be soon, can I just leave it in my account, and then in two years when I request a check to be mailed, pay tax on it then. Or will they somehow hunt me down? If so how can I just "throw away" the money and get myself out of any tax obligations!

I might also add its my only income and I've never filed tax before

throw it my way and i'll pay the tax on it haha :D

Originally posted by Yarkatonafus
[B]Now, if I don't have my credit card or bank account in the account, and I haven't told it my SSN, are they going to search me out if I don't pay taxes

Umm... I dont think paypal allows over $100.00 to your account per month unless you have a business account. And I know you cant have a business account unless you either put a CC on file or register a bank account. I would highly recommend doing things by the book if theres going to be anyone to try and pull a fast one on belive me its not uncle scam. Especally when they start with there late payment and penalty fees. When I was younger I drove a cab for a year and I forgot :rolleyes: to do my taxes that year due to the fact I was "self employed" and was not sure of the process. So about 3 years passed and I get a nice notice about my earnings in 98' blah blah blah so anyway I eneded up owning 640.00 in taxes and $700.00 in penaltys. So I guess you could say I leanred my lesson. Just some pre-warning.

No, you don't have to give it your CC or anything, it just remains unverified. I have $2000, this is not hypothetical.

Ok let me re-pose the questions. I am not in a position to be able to pay or files taxes. My two choices are to either keep the money in the account until I turn 18 in 2 years and then pay the tax due on the check PayPal sends, or to close the account and have the money sent somewhere where I'm not, basically saying bye-bye money. I don't want to get into any tax trouble .. thanks!

go ahead anf file taxes, but be sure to mention expenses. If you can make it look like your net profit is under 2k, you won't pay taxes anyway.