Taxes and Amazon Mechanical Turk

We’ve all heard the line, “Everything can be put off, but death and taxes.”

Well, you’d think in this arena of making money online and the shamefully low wages offered on Amazon Mechanical Turk (Mturk), you’d be exempt from taxes. Well, you’d be wrong. Well, partially wrong. If you only make a small amount of money off Mturk then you are exempt from paying taxes, but there is a threshold amount you can make before you have to legally pay Uncle Sam his due.

One you reach a certain threshold on Mturk, you will be prompted by the system to enter you tax information. (The system will already have some of your other vital information when you set-up your account and associated bank account -- provided you do set-up a bank account.) Being a U.S. citizen, all I had to do was provide my Social Security number. They already had my address.

One thing you don’t want to do is what I did. When you first get that prompt, please don’t ignore it. It will just stay there and bug you. And if you wait too long and refuse to provide your information, guess what happens? You get your account shut off. Well, at least the capability to earn more money. I was slothful in my response, but did eventually enter my information. My problem came when Amazon was slow to process my information and I did get my ability to take on new HITs shutdown. Fortunately, I sent Amazon a message early in the morning and they processed my information and I was back in business in a few hours. There’s no guarantee that they will be as responsive with you.

So, take my advice, when prompted for your tax information, just go ahead and enter it. Then you’ll avoid all the hassles.

Now, you may ask, what is the my income threshold. Amazon defines this amount as:
“...the minimal payment a company can pay a Worker before the company must report the payments to the IRS.”

So there you have it, death and taxes are truly unavoidable even in the world of Mturk.