>>2. Any sale over 500 (I think it is) should be reported to the IRS - if you aren't making that much then don't worry about it. You do have to show a profit after the first few years. But best to sit down with an accountant and pick their brain - it will be worth it in the long run.

Yes indeed check with your accountant. Beacuse, while these are commonly held beliefs, my accountant way back when told me these are myths.

>His ideas follow<

That to be a business you must be behaving like a business. That is buying or producing, selling, keeping detailed books, making invoices.... If you are running fast and loose not keeping books and not invoicing your buyers then you are a hobby. Hobbies must report profits but may not report a loss.

Lastly, profit is NOT a requirement of a business. You can indeed lose money every year and write off the losses. (amazon.com went over a decade without a single cent of profit!) BUT you must be behaving like a business. Otherwise it is a hobby and losses may not be written off.

>/end his ideas.<

Check with a real professional. I am not an accountant nor do I play one on TV.
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[ Hide Replies ]

• hobby or business? - insangelic, Thu Feb 18 15:00:57 2010
• RE: hobby or business? - toshamc, Thu Feb 18 16:29:41 2010
• check with your accountant - amazonreptile, Sat Feb 20 09:59:31 2010
• RE: hobby or business? - insangelic, Thu Feb 25 12:23:52 2010
• RE: hobby or business? - CaliRepGuy, Thu Feb 18 17:21:18 2010
• RE: hobby or business? - insangelic, Fri Feb 19 10:46:31 2010
• RE: hobby or business? - calirepguy, Fri Feb 19 13:36:17 2010
• RE: hobby or business? - SD_Dan, Fri Feb 19 16:11:08 2010
• RE: hobby or business? - insangelic, Fri Feb 19 18:59:27 2010
• keep on a ramling man.... - chongorojo, Fri Feb 19 20:09:48 2010