It could be any one of the following: a wart, a sebaceous cyst, a skin tag, a lesion secondary to trauma, or a dermal neoplasm such as a sebaceous adenoma or a histiocytoma , which are benign, or it could be something more serious such as a mast cell tumor, squamous cell carcinoma or other cancer.
For a definitive diagnosis it really must be investigated by your veterinarian. As I have mentioned in several answers please find out if the Care Credit credit card would enable you to get veterinary assistance for your dog.
Thank- you for taking the time to respond to my question. If I see it getting worse, I will take him to the vet. I guess you can't treat it, if you don't know what it is?