Tag Archives: manufacturer coupons

Consider this example… An individual buys $10 of Product at a store and applies $4 in manufacturer coupons to that purchase. The buyer then submits a $5 mail-in manufacturer rebate for the same products. Finally, the buyer resells the product for $10 with a $3 shipping expense.

Assuming that the reseller repeats a similar buying and selling habit with a wide variety of products forming part of their small business self-employment income, could that person report the net expenses for the products ($10 – $4 – $5 + $3 shipping = $4) as a cost of goods sold? Would the rebates be taxed as gross income rather than associated with the cost of goods?