Is The Sale Of A Domain Name Taxable. The lowest the hobby income can be is net zero as a dollar amount for the tax year. For many of the states that exempt web hosting it is important to separate other taxable items from the web hosting charges.
So domain name costs can be included if domain name collecting is the tax filers hobby but the expense cannot exceed the total income earned from the activity. The market for domain name purchases and sales offers indisputable evidence that domain names appreciate in value. The domain name owner now owns a property right in the form of his contract.
The taxable amount is 6500-2500 4000.
Internet domain name registration services are generally subject to retail sales or use tax. Because they satisfy the two-factor test the increase in their value should be deemed capital in nature and the tax treatment applicable to capital gains and losses should apply to domain name sales. The market for domain name purchases and sales offers indisputable evidence that domain names appreciate in value. The taxable amount is 6500-2500 4000.