BadRap

Lund is giving you good advice, especially about contacting a tax professional. One thing to consider, you may be able to report this as hobby income rather than business income. The reason this is important is that business income is subject to Self Employment (FICA) tax of 15.3% while hobby income is not. With a hobby, as long as you itemize you may still be able to deduct all your expenses. Bottom line, get the help of a tax pro who understands the tax code. Also, if you get a 1099-MISC for goods you win, you may be able to report a lesser amount as income. The payer will likely issue the 1099 for the retail price of the goods, if you can show that the item is available at a lesser price you can use that lesser price as the fair market value. Good luck in making this your problem!