dpd1 - 7:18 am on Jul 2, 2011 (gmt 0)
If the customer is paying you for shipping, then you deduct that from your sales total, and claim the rest as your actual income (before deductions). What he's saying is... If the shipping is 'hidden' in the price under the guise of "free shipping", then if you were going to be a Dudley Do-Right about it, you should not deduct shipping expenses on your taxes, because technically you were paid for shipping within the price of the items. But in reality... Do you really think anybody does that? People put up a price, say it's free for shipping, then they deduct the the shipping expenses on their taxes. An IRS guy would probably fall off his chair if he found somebody who did NOT do that. Now if you publicly stated that shipping was "included in the price". Then that's a different story. All they'd have to do is point to that, and you're hosed.