Posted by John_NorCal on 6/12/07 10:01pm
Msg #194808

Business Profiling

I'm attending a tax seminar here in Las Vega (or is that Lost Wages?) in one of my sessions on business returns the speaker was talking about losses as they relate to a viable business vs. a "hobby" business.
The IRS is looking at a lot of things when they analyze/audit a return with a schedule C. One of the first things they look at is does the taxpayer have a business plan? Is there a reasonable expectation of making a profit or is it trying to offset other income? Does the taxpayer have prior experience in the field?
The point I want to make to everyone is to operate your business like you mean it and not merely as a means to get "extra" money. Get a good bookkeeping system and pay attention to all of your expenses and income. You will soon find out that those $50.00 signings that you drive miles and miles to accomplish, are really costing you money.
If you aren't turning a profit look at ways to improve things. If you don't want to do that, you'll find that you're only hurting yourself in the long run.

http://www.notary-4you.com
http://www.thetaxfighter.com

Reply by Charles_Ca on 6/13/07 12:32am
Msg #194828

Re: Business Profiling - Great post John, most don't realize

that there is a huge difference between hobby and profession. Did the presenters cover the portion of your business "at risk?" As I understand it to be able to deduct certain items one of the questions that needs to be answered is if your investment is at risk.