How should I treat income from focus groups?

Q: I periodically attend "focus groups" for marketing research companies. They pay us for our time, from $50-$100 usually. How are you supposed to treat this income? —Jim, Waltham

The following answer was provided by Barry Beck, CPA, Barry D Beck, CPA, PFS, DABFA.

A: You are taxable on income from all sources which includes the focus income. Even though you do not receive a form from the focus group, you must still include the income on your returns and it is taxable for regular tax purposes. This income is also considered self-employment income, which means that you must also use IRS form SE, to calculate the SE tax.