Well, I did my taxes, and I declared all my income from my website, including donations, t-shirt sales, and ad revenue minus hosting costs, domain registrations costs, part of my cable modem cost, and part of this laptop I’m currently typing on. Ended up costing me about a hundred bucks in taxes and another ninety or so for having H&R Block do a Form C for me.
Anyone else know how other bloggers are handling blog income? I don’t think Amazon or Paypal reports to the IRS, so it would be pretty easy to get away with not mentioning your donations (but nothing is more wrong than tricking the IRS).