IRS and Biz?

Racetog

Hey gang,

Now that I’m running my own website have a few questions… When I worked for a company they’d send me a 1099 at the end of the year. I’d just add that amount to my ‘income’ and was done with it. Photography is just a side gig that I make a few bucks at.

Sold some photos and need to send in the W-9 to Smugmug. How are you folks dealing with the tax man? I’d assume the same way as a 1099, just report the income… But, I’d like to write off some gear purchased this year. How do I make sure everything is legit? Get a business license of some kind? Or?

Thanks for any insight,
Mike

Racetog

No one has any advise on this?

Racetog wrote:

Hey gang,

Now that I’m running my own website have a few questions… When I worked for a company they’d send me a 1099 at the end of the year. I’d just add that amount to my ‘income’ and was done with it. Photography is just a side gig that I make a few bucks at.

Sold some photos and need to send in the W-9 to Smugmug. How are you folks dealing with the tax man? I’d assume the same way as a 1099, just report the income… But, I’d like to write off some gear purchased this year. How do I make sure everything is legit? Get a business license of some kind? Or?

Thanks for any insight,
Mike

pat.kane

Racetog wrote:

No one has any advise on this?

On-line forums aren't a good place to seek legal and tax advice.

With that said, go to the IRS web site and find the Schedule C form and instruction. Read that info front to back, then read it again.

Sit down and figure out whether you are doing this as a hobby or a business. Here's one link on the IRS web site:
http://www.irs.gov/businesses/small/article/0,,id=99239,00.html

If you're not likely to show a profit, the IRS is going to treat your "business" as a hobby and there will be back-tax issues that result from this.

Even simple statements such as "I'd like to write off some gear purchased this year," don't have simple answers. Depreciation comes into play and you need to make the right decisions when you have the choice to fully deduct in a given year and/or to depreciate over multiple years.

I've filed Schedule C returns for quite a few years (not for photography) and I can assure you that an hour or two discussion with an accountant would be well worth the expense.

Good luck.

Andy

pat.kane wrote:

I've filed Schedule C returns for quite a few years (not for photography) and I can assure you that an hour or two discussion with an accountant would be well worth the expense.

Good luck.