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What is the proper way to report additional income for taxes (specifically, Android development)?
You would report it as business income on Schedule C.  You may be able to take deductions against that income as well (home office, your computer, an android device, any advertising or promotional expenses, etc.) but you'll want to consult an accountant about that. Generally you can only take those kinds of deductions if you use the space or equipment exclusively for business use (not likely if it's just a hobby).  The IRS is pretty picky about that stuff.