Can we ask tax questions in this group?

[OKNancy]

This is the first year I will not use a CPA and will file using TurboTax.

I'll ask more if it is allowed.

[elleng]

1. I'm not an administrator,

but in the past there have been those with questions helped by those with expertise, so I'd say, try it. Usually those with expertise include caveats that their info is not intended as substitute for private, professional advice.

[OKNancy]

2. OK.. this is a general question anyway

I used to own an S-Corp, but retired in 2010, so I really don't need to pay an accountant anymore.
Also he retired about the same time I did ( he was with me over 30 years)

One thing he did on my 2010 taxes was to count my little internet site as a business. This is a side thing.. NOT the S-Corp.
I kind of argued with him a little. I wanted it to be a hobby. As I read the IRS pages on what is considered a hobby, I'm pretty sure it's a hobby. I made about $750.00 in advertising commissions and maybe $1000.00 in "subscriptions".
I don't use the site to make money. It's just for fun. I do have some expenses, but nothing major.

So far no problem right? Well, my hubby says, if John ( not his real name) said it was a business, then it should be one this year too.
My argument was that John was a little behind the times and I even had to tell him what forms to fill out on another matter.

So.. the reason I want to list it as a hobby is...
1. It will save me preparation fees
2. I won't have to pay employment taxes on the profits.
3. It's just a heck of a lot easier.

My husband is freaking out thinking it may trigger suspicion if one year it's a business and the next it is a hobby.

[A HERETIC I AM]

3. In the pages you read.....

did you read if it said that any income generated from a "hobby" had to be reported? Did you see if there was a threshold? $1000? $1500? And what test did they give (there is usually examples or tests provided on those IRS publications) to decide if it had to be listed as a business instead of a hobby?

I can think of an example with something I am interested in;

I am fascinated by Live Steam, smaller scale (1.5" to the foot) Locomotives. If I ever hit the lottery, I would buy a milling machine and the other tools needed to construct one. If I got to the point that I could turn out say - drive wheels for a 4-6-6-4 Challenger (just google that to see what I am talking about) quickly and sell them on the internet, if I only sold one or two or maybe ten a month, it is no big deal. But when it gets to the point that I am selling 500 a day, for instance, it adds up. It has gone beyond something I did for 3 hours in the evening and is now a full time vocation.

I am sure you're way ahead of me here, however.

Unfortunately, I am by no means experienced in tax rules for small businesses, but I would think that at some point, if you have a hobby and it makes you money, sooner or later it becomes more of a business than a hobby.

[SheilaT]

7. I had a similar question a couple of years

ago of my accountant. I crochet scarves and make earrings and sell them casually. I perhaps make as much as a thousand dollars in a good year.

My accountant said that it was definitely a hobby and that the IRS really didn't care that much about such a trivial amount of money.

We did not discuss if there was some maximum you could make beyond which what you were doing was no longer a hobby, but a business.

Perhaps you can go to one of those free things that groups do for senior citizens in connection with taxes and get a definitive answer there.

But then, given how complex our tax code is, definitive answers rarely exist. One way to think about this is to ask yourself some questions like, How likely is the IRS to figure out how much money I'm making? How likely are they to want to get their share?

The bigger deal might be if your local taxing agency (city, county, state) takes an interest in what you're doing. My little scarf and earring sales readily fly under the radar, because I either get a table at a craft fair, or just sell on a casual basis to people I know.

[A HERETIC I AM]

4. And Elleng, as far as an admin goes, I don't think this group needs one...

and I am against the idea of having one.

Or host or whatever other name there is.

[elleng]

5. Gotcha, Heretic. I agree.

Glad you saw this.

[Common Sense Party]

11. I agree. We do not have a host currently. I don't think it's necessary.

We're very low-activity as it is, and the conversations don't get heated.

I like it the way it is. If someone has a question or wants to learn more, they can post a question.

If someone has an interesting article to share, they should share it and discuss it.

I don't see how a host or moderator would help that process.

[Billy Patterson]

6. Yes Obbiously

We would be happy to answer your question.

[reinfinland]

8. found

oh.. found this post ......

[William769]

9. Welcome to DU!

[In_The_Wind]

10. Indeed. It's fun to welcome a newbie to DU.