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View Full Version : Pro or amateur?


MDJAK
15th of December 2004 (Wed), 18:44
While my technique is that of an intermediate at best, I have had quite a few sports photos I've taken featured in our local newspaper, both swimming and wrestling pictures. I email a few each week to the sports editor and from time to time he selects a photo to put in the paper. I do get credit for the photo below the caption and it is truly rewarding for me as I'm not a pro and do it for the sheer enjoyment.

So, here's my question. If I could somehow get the newspaper to pay me, even a pittance, could I consider myself a pro to the point that I could deduct the cost of equipment on my taxes? That might be the only way I could get my dream machine: the 1ds Mark II.

Thanks in advance for any input.

vwpilot
15th of December 2004 (Wed), 20:12
Yes, you can consider yourself a business and a sole proprietorship and then file all your business income on the same forms as your normal income. You can then deduct ALL exenses related to your photograhpy.

However, the IRS does want to make sure you are really a business, which means that you have to begin to show a profit or they will consider you a hobbyist and you cannot deduct what you could as a business. You must show a profit for at least two of the first five years after you start the business. Check with an accountant on that, not sure the exact numbers you need to meet.

But if you do not show that profit within the proper time then you can be responsible for back taxes for the stuff you wrote off the business that didnt really materialize.

You also need to be ready to prove to the IRS that it is a business if they decide to audit you, so you need to keep a seperate checking account and all the paperwork associated with billing etc. just in case.

So you have to decide if the work is worth the deduction.

MDJAK
16th of December 2004 (Thu), 04:53
Thank you both for that info. I guess I'll just have to start flippin burgers at McDonald's and save my pennies.

But yesterday I was reading two reviews on the 1d Mark II (not the S) and it may be within my reach. I think I'd be happy with that.

timmyquest
16th of December 2004 (Thu), 09:33
Thank you both for that info. I guess I'll just have to start flippin burgers at McDonald's and save my pennies.

But yesterday I was reading two reviews on the 1d Mark II (not the S) and it may be within my reach. I think I'd be happy with that.

I'd love to have the mark 2, i couldnt afford it. I got the original 1D. I've owned it for about 3 months, it's made me over $300 in that short time and helped land me employment by my local paper.

JCK
18th of December 2004 (Sat), 02:05
"But if you do not show that profit within the proper time then you can be responsible for back taxes for the stuff you wrote off the business that didnt really materialize."



So you mean that you have to have a succesfull business in order to deduct you equipment? It all goes wrong and then the government takes you deeper?

robertwgross
18th of December 2004 (Sat), 13:27
"But if you do not show that profit within the proper time then you can be responsible for back taxes for the stuff you wrote off the business that didnt really materialize."

So you mean that you have to have a succesfull business in order to deduct you equipment? It all goes wrong and then the government takes you deeper?

That is what is known as CATCH-22.

That is one thing that should prevent you from going into business just to dabble around. The time to form the business is when, and only when, you think you can make it go profitable in the short term.

There are other ways to do this (S Corporation, etc.) and then you can be unprofitable as long as you want. I worked for a company that barely ever paid any federal tax for twenty years.

---Bob Gross---