Wife is selling Lia Sophia jewelry and made less than $600

Your wife should have received a 1099-MISC from Lia Sophia listing her profit. Yes you should claim this in Schedule C. Take into account the business expenses she incurred during the year. Careful receipt handling will help. Her starter kit alone was over $149. The hostess bonus item she gifted should be $15 for each of her shows. If she made her own invitations, she would have spent on paper, printer ink, and postage supplies. Other supplies such as catalogs and other lia sophia printed supplies also add up. Also consider the mileage (if she tracked them) she commuted for each of her shows. If she bought other durable materials to support her show (e.g. mirror, trays, etc) that can be claimed too. In the end she may have spent more than she made. Lia Sophia may be a good thing but she needs to hustle to get away from a business expense break-even.