<div dir="ltr">Here is a page from the IRS website regarding hobby vs for profit business.<div><br></div><div><a href="https://www.irs.gov/uac/is-your-hobby-a-for-profit-endeavor">https://www.irs.gov/uac/is-your-hobby-a-for-profit-endeavor</a><br></div><div><br></div><div>Rich Sbardella</div></div><div class="gmail_extra"><br><div class="gmail_quote">On Tue, Jan 17, 2017 at 8:58 AM, Tony Parkes via Callers <span dir="ltr"><<a href="mailto:callers@lists.sharedweight.net" target="_blank">callers@lists.sharedweight.net</a>></span> wrote:<br><blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex">
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<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">Luke Donforth wrote:<u></u><u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif"><<I've already had two inquiries, so I should specify, the $8000 was income paid not counting airplane tickets. It didn't remove mileage reimbursement, CDSS membership and
insurance, etc. <u></u><u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">Net comes to about $5000.>><u></u><u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif"><u></u> <u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">Luke, does your “net” figure represent what you have left after *<b>all</b>* expenses? Have you deducted 54 cents per mile driven (the IRS rate for 2016), whether or not you
were reimbursed? (The alternative is to figure actual car expenses and deduct the percentage of those that corresponds to business use of the car, but it’s simpler to take the mileage allowance.) If you own any sound equipment, whether it’s a mic or a full
system, have you expensed or depreciated each piece? (I’m not an accountant, but our accountants have always told us it’s OK to expense relatively small purchases rather than bother with depreciating them.)<u></u><u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif"><u></u> <u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">The one expense we don’t bother listing is meals on the road. The IRS allows only 50 percent of those to be written off (rule adopted in response to the three-martini business
lunch); much of the time we get fed by our hosts; we tend to eat cheaply when we’re paying out of pocket; and we figure we would have spent that much on food anyway. But all other expenses get itemized on Schedule C.<u></u><u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif"><u></u> <u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">In a typical year our net (taxable) figure is less than half our gross. I agree that it’s a good idea to think about these things as one weighs how intently to pursue calling
or playing for dances. I used to go anywhere for any amount of money, just for the joy of calling. Somewhere along the line I realized that I was losing money on many of my gigs, and I got more careful about pay scale vs. distance traveled.<u></u><u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif"><u></u> <u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">For many years my rule has been “for love or money” – both is better, but one or the other is essential. If I suspect it’s going to be a tough gig (e.g. an open bar or a “family”
dance where the parents won’t join in), I quote high enough that I won’t kick myself later. Conversely, I’ll go out for short money if it’s a chance to work with some treasured friends/colleagues, or if it’s a new series that wants help getting off the ground,
or if I get to call lots of Merry-Go-Round-type squares <evil grin>.<u></u><u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif"><u></u> <u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">Not specifically addressed to Luke: There’s a common belief that if the IRS decides your calling or playing is a hobby, you’re not allowed to deduct any expenses. On this subject,
the IRS says only that losses can’t exceed gross income, so presumably you can deduct expenses down to the break-even point. Note that if you’ve made a profit in three of the last five years including the most recent year, the IRS assumes it’s a legitimate
business.<u></u><u></u></span></p>
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<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">Tony Parkes<u></u><u></u></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">Billerica, Mass.<u></u><u></u></span></p>
<p class="MsoNormal"><a name="m_3773946137191415705__MailEndCompose"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif"><u></u> <u></u></span></a></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt;font-family:"Calibri",sans-serif">From:</span></b><span style="font-size:11.0pt;font-family:"Calibri",sans-serif"> Callers [mailto:<a href="mailto:callers-bounces@lists.sharedweight.net" target="_blank">callers-bounces@lists.<wbr>sharedweight.net</a>]
<b>On Behalf Of </b>Luke Donforth via Callers<br>
<b>Sent:</b> Tuesday, January 17, 2017 7:56 AM<br>
<b>To:</b> <a href="mailto:Callers@Lists.Sharedweight.net" target="_blank">Callers@Lists.Sharedweight.net</a><br>
<b>Subject:</b> Re: [Callers] Totals for taxes<u></u><u></u></span></p>
<p class="MsoNormal"><u></u> <u></u></p>
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<p class="MsoNormal" style="margin-bottom:12.0pt">I've already had two inquires, so I should specify, the $8000 was income paid not counting airplane tickets. It didn't remove mileage reimbursement, CDSS membership and insurance, etc.
<u></u><u></u></p>
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<p class="MsoNormal">Net comes to about $5000.<u></u><u></u></p>
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