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by TexasTuma. 07/01/25 04:16 PM
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Re: Wow, I really shouldn't have added this up [Re: Karl_Brogger] #161751
12/02/08 06:31 PM
12/02/08 06:31 PM
Joined: Nov 2005
Posts: 5,582
“an island in the Pacifi...
hobie1616 Offline
Carpal Tunnel
hobie1616  Offline
Carpal Tunnel

Joined: Nov 2005
Posts: 5,582
“an island in the Pacifi...
Hire a CPA with a really sharp pencil to set up write offs.


US Sail Level 2 Instructor
US Sail Level 3 Coach
-- Have You Seen This? --
Re: Wow, I really shouldn't have added this up [Re: Jake] #161795
12/03/08 11:15 AM
12/03/08 11:15 AM
Joined: Apr 2007
Posts: 334
Seattle,Wa
Don_Atchley Offline
enthusiast
Don_Atchley  Offline
enthusiast

Joined: Apr 2007
Posts: 334
Seattle,Wa
Quote
Also, you can only show a business loss for three continuous years.


I think this changed several years ago. They said you only have to make an attempt at running a business. You don't have to be successful... whistle


Hobie Tiger 2003
Re: Wow, I really shouldn't have added this up [Re: Don_Atchley] #161797
12/03/08 11:33 AM
12/03/08 11:33 AM
Joined: Feb 2005
Posts: 4,119
Northfield Mn
Karl_Brogger Offline OP
Carpal Tunnel
Karl_Brogger  Offline OP
Carpal Tunnel

Joined: Feb 2005
Posts: 4,119
Northfield Mn
Originally Posted by Don_Atchley
I think this changed several years ago. They said you only have to make an attempt at running a business. You don't have to be successful... whistle


That's been my plan all along! (sarcasm) cry Gawd this year has sucked! With the equipment that I bought this year, (total of only about $8k), the left over depreciation from last year, and the expenses from this year I might not have any taxable income this year. The good thing about things being slow, is that everyone else is slow too. A lot of cabinet shops going tits up, and I've gotten some rediculously good deals on used equipment.

Re: Wow, I really shouldn't have added this up [Re: Don_Atchley] #161803
12/03/08 12:24 PM
12/03/08 12:24 PM
Joined: Jan 2004
Posts: 1,884
Detroit, MI
mbounds Offline
Pooh-Bah
mbounds  Offline
Pooh-Bah

Joined: Jan 2004
Posts: 1,884
Detroit, MI
Originally Posted by Don_Atchley
Quote
Also, you can only show a business loss for three continuous years.


I think this changed several years ago. They said you only have to make an attempt at running a business. You don't have to be successful... whistle


It's a little more complicated than that.

The "three out of five" rule is part of Internal Revenue Code Section 183 (commonly called the "Hobby Loss Rule") which is a determinant of whether an activity has a "profit making motive". In general, you can only deduct "hobby" losses to the extent of gains - i.e. you can deduct your racing expenses against your winnings.

This would prevent anyone who has a regular day job from deducting regatta expenses from their regular income.

However, if you are a business owner (like Karl), who have an entity engaged in a "for profit activity" (cabinet shop), you can deduct expenses qualified under IRC Section 162 (ordinary and neccessary - like advertising)from your business income without regard to the "3 of 5" rule. However, the quantity of those dedections may come under scrutiny in the event of an audit (was the amount of advertising justified for the size of the business, etc.). For example - if advertising was the largest expense line item for a cabinet shop, it would certainly raise some questions.

As always, keep meticulous records and receipts when dealing with the IRS.

Re: Wow, I really shouldn't have added this up [Re: mbounds] #161831
12/03/08 03:49 PM
12/03/08 03:49 PM
Joined: Nov 2005
Posts: 5,582
“an island in the Pacifi...
hobie1616 Offline
Carpal Tunnel
hobie1616  Offline
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Joined: Nov 2005
Posts: 5,582
“an island in the Pacifi...
Originally Posted by mbounds
As always, keep meticulous records and receipts when dealing with the IRS.

And, if you do get audited, don't take their first ruling as gospel if it goes against you. My dad did 30 years with the "revenuers" in a number of different jobs. The last one was Chief of Conference which was the last place you went before going to court. He told me 75% of their case load was computer entry error.

One year I was expecting about $400 back. Instead of getting the green check I go a form that said I'd paid minus $3.60. They wanted $1000 plus $1500 in penalties. I called dad, who prepared my return. He said he was going to the Fresno data center the next day to discuss the same kind of problems and would let me know what happened the next night.

The day went something like this. He went into the meeting where they shucked and jived him for an hour. He then asked them to pull my return but only gave them my SS#. They passed it around the room and said, "We're gonna screw this guy to the floor."

My dad asked, "Did anyone happen to see who prepared the return?"

No one had.

My dad said, "IT WAS ME!!!"

The rest of the day consisted of him raging through the building and them sounding like Yorkies that just has their feet stepped on.

I wish I'd been there. laugh


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Re: Wow, I really shouldn't have added this up [Re: hobie1616] #161838
12/03/08 04:08 PM
12/03/08 04:08 PM
Joined: Aug 2006
Posts: 182
Appleton, WI
blockp Offline
member
blockp  Offline
member

Joined: Aug 2006
Posts: 182
Appleton, WI
You had to go and do that didn't you... I was fine with my head in the sand!!!

Since I don't race my cat, I spend very little per year on my boat. For example, relatively speaking, a "large" sailing expenditure for me last year was to buy $40 worth of line and $100 worth of Vertglass products. So to say the least, I was surprised at what some of you say you spend on sailing in a year. So this little topic prompted me to put together a sheet on my projected ski expenditures for this year.

Ugh!!! 2 trips west, a handful of planned weekends in MI, lift tickets, travel, hotels, etc... my spreadsheet says to plan on about $4k this winter. And that's not counting any spontaneous trips north to chase good snow storms (usually at least once or twice a year), or another set of used powder skis that I may or may not buy this year.

Now I'm beginning to feel shame...

Re: Wow, I really shouldn't have added this up [Re: blockp] #161841
12/03/08 04:14 PM
12/03/08 04:14 PM
Joined: Nov 2002
Posts: 5,558
Key Largo, FL & Put-in-Bay, OH...
Mary Offline
Carpal Tunnel
Mary  Offline
Carpal Tunnel

Joined: Nov 2002
Posts: 5,558
Key Largo, FL & Put-in-Bay, OH...
Quote
Now I'm beginning to feel shame...

Don't feel shame. According to the registration forms for 20 years of our doing sailing seminars, skiing is the number one second favorite sport of sailors. In fact, maybe for many it is the first favorite.

Re: Wow, I really shouldn't have added this up [Re: blockp] #161845
12/03/08 04:33 PM
12/03/08 04:33 PM
Joined: Dec 2001
Posts: 5,590
Naples, FL
waterbug_wpb Offline
Carpal Tunnel
waterbug_wpb  Offline
Carpal Tunnel

Joined: Dec 2001
Posts: 5,590
Naples, FL
Originally Posted by blockp
Now I'm beginning to feel shame...


It's not shame.... it's a HOBBY.

Rarely do things we enjoy make monetary sense


Jay

Re: Wow, I really shouldn't have added this up [Re: waterbug_wpb] #161874
12/03/08 06:04 PM
12/03/08 06:04 PM
Joined: Apr 2007
Posts: 291
J
JACKFLASH Offline
enthusiast
JACKFLASH  Offline
enthusiast
J

Joined: Apr 2007
Posts: 291
Originally Posted by waterbug_wpb
Originally Posted by blockp
Now I'm beginning to feel shame...


It's not shame.... it's a HOBBY.

Rarely do things we enjoy make monetary sense


Like crystalmeth grin


Collin Casey
Infusion Platform + C2 rig and rags = one fast cookie
Re: Wow, I really shouldn't have added this up [Re: JACKFLASH] #161935
12/04/08 12:39 PM
12/04/08 12:39 PM
Joined: Dec 2007
Posts: 1,430
california
F-18 5150 Offline
veteran
F-18 5150  Offline
veteran

Joined: Dec 2007
Posts: 1,430
california
14 regattas X $40.00 = $560.00
Average 400 miles each way at 20 mpg at $4.00 gal = $2240 in fuel 11200 miles
3 days each regatta camping at $ 20 a nite. = $840
One trashed Spin $1000
One trashed main $ 1500 (I got one used)
Annual cost of this fun $6140.00 (est. actual cost may differ)


Richard Vilvens
Brand Ambassador
PSA Capricorn USA
[email protected]
Fairfield, Ca
F-18 5150

http://www.capricornsailing.com/
Re: Wow, I really shouldn't have added this up [Re: F-18 5150] #161936
12/04/08 12:43 PM
12/04/08 12:43 PM
Joined: Dec 2007
Posts: 1,430
california
F-18 5150 Offline
veteran
F-18 5150  Offline
veteran

Joined: Dec 2007
Posts: 1,430
california
Next year the north american championships are 865.63 miles each way. Yea Why does my 05 truck have over 100,000 miles on it, its my boats fault.


Richard Vilvens
Brand Ambassador
PSA Capricorn USA
[email protected]
Fairfield, Ca
F-18 5150

http://www.capricornsailing.com/
Re: Wow, I really shouldn't have added this up [Re: F-18 5150] #161939
12/04/08 01:27 PM
12/04/08 01:27 PM
Joined: Feb 2005
Posts: 4,119
Northfield Mn
Karl_Brogger Offline OP
Carpal Tunnel
Karl_Brogger  Offline OP
Carpal Tunnel

Joined: Feb 2005
Posts: 4,119
Northfield Mn
1783 miles one way for me to HavaMega. I need to get another good mini truck. I had a 97' 2wd extended cab S-10 with a V6, an 5sp. It was semi fun to drive, and actually got pretty respectable mileage. I just can't afford to replace my diesel. New ones cost too much.

Re: Wow, I really shouldn't have added this up [Re: F-18 5150] #162220
12/08/08 12:48 PM
12/08/08 12:48 PM

A
andrewscott
Unregistered
andrewscott
Unregistered
A



$3,329.90 a year to do the thing you love... sounds like a bargan to me...

Re: Wow, I really shouldn't have added this up [Re: ] #162226
12/08/08 01:43 PM
12/08/08 01:43 PM
Joined: Dec 2007
Posts: 1,430
california
F-18 5150 Offline
veteran
F-18 5150  Offline
veteran

Joined: Dec 2007
Posts: 1,430
california
If you think sailing is expensive , Hire a theripist. How many beach cat sailors you know see a shrink? I don't know any but i know shrinks are alot more expensive than sailing.
Lets not call it racing lets call it theraputic competition and write it off as a medical expensce.


Richard Vilvens
Brand Ambassador
PSA Capricorn USA
[email protected]
Fairfield, Ca
F-18 5150

http://www.capricornsailing.com/
Re: Wow, I really shouldn't have added this up [Re: F-18 5150] #162229
12/08/08 02:11 PM
12/08/08 02:11 PM
Joined: Dec 2001
Posts: 5,590
Naples, FL
waterbug_wpb Offline
Carpal Tunnel
waterbug_wpb  Offline
Carpal Tunnel

Joined: Dec 2001
Posts: 5,590
Naples, FL
Would these "team-building" weekend courses work for the deduction?



Jay

Re: Wow, I really shouldn't have added this up [Re: F-18 5150] #162236
12/08/08 03:27 PM
12/08/08 03:27 PM
Joined: Jun 2001
Posts: 12,310
South Carolina
Jake Offline
Carpal Tunnel
Jake  Offline
Carpal Tunnel

Joined: Jun 2001
Posts: 12,310
South Carolina
Originally Posted by hobie18rich
If you think sailing is expensive , Hire a theripist. How many beach cat sailors you know see a shrink? I don't know any but i know shrinks are alot more expensive than sailing.
Lets not call it racing lets call it theraputic competition and write it off as a medical expensce.


I second that!


Jake Kohl
Re: Wow, I really shouldn't have added this up [Re: JACKFLASH] #162247
12/08/08 04:28 PM
12/08/08 04:28 PM
Joined: Jun 2001
Posts: 733
Home is where the harness is.....
Will_R Offline
old hand
Will_R  Offline
old hand

Joined: Jun 2001
Posts: 733
Home is where the harness is.....
Originally Posted by JACKFLASH
Originally Posted by waterbug_wpb
Originally Posted by blockp
Now I'm beginning to feel shame...


It's not shame.... it's a HOBBY.

Rarely do things we enjoy make monetary sense


Like crystalmeth grin


Unless you're into production or distribution

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