Doug,

Yeah, that's what I do and have been doing for 3 years, I guess I would feel better now that PayPal is reporting to have my RE on that account.

It is like any Zero Return - you are only to report Taxable Income and it depends entirely upon your right to be heard, and the law. That last part is why Pete HENDRICKSON is in prison. He figured that could read:

What I am saying is that the Reports from clients and PayPal are not heard when you send in a signed 1040 Form. They become Hearsay, compared to your signed testimony.
David, Thanks for contributing... I'm missing how that image you posted is relevant to your quote above. That looks like a zero return, which I don't have. I have a fair amount of FRN liability, about 1/3 of the gross.

It seems as though I'm not doing a very good job of explaining myself.

I'm in business. I do have a storefront, so it's obvious I'm in business.

I do pay the local tax. The State has no tax.

I have to file a federal return. I do not have any withholdings, I pay (if I owe)
when I file.

Say I have 100K gross. 30K is non-restricted endorsed FRN. The rest has been
lawful money through my restricted endorsements.

Say the cost of doing business is 45K. Leaving a surplus of 65K.

My local borough tax is quarterly, which I have to pay on the gross every quarter.

What I'm getting down to here is this;

How is this written up on the return? There are places for the gross, and the net,
but there is no place for "how much was in lawful money".

If I write down the numbers as they are, they are going to say that I owe them taxes
on 65K which comes out to about 15-20K.

But what I'm telling them is that I don't owe them anything because I'm only liable for
30K, which after tax credits and cost of doing business is nothing owed.