Business Owner...write offs

JRCurtis

New member
For all you karting business owners, what all do you write off for expenses....

Hotels, gas, pit pass, and such?
 

flattop1

Dawg 89
the NSA is watching you.
what you can write off and what they allow are 2 totally different concepts.
Heck even two different tax people can't agree on this.
 

alvin l nunley

Site Supporter
Flattop1 may have it right, I sure wouldn't know, but my accountant told me that as long as you are really trying to make a profit, and can prove it, you can write off "all" your expenses forever. But I'll tell Ya, she was one hell of an accountant, something they call, an enrolled agent. She was very intimidating to the, just out of college, IRS agents.
 
I would ask who ever prepairs your taxes. The laws change from year to year. Thats one teck shed you dont want to be in.....
 
Jr,

Be very careful what you try to write off. And remeber, everything you buy out of state that you didn't pay taxes on, you must fill out a sepertate form and pay taxes for as the end user ;)

Keep receipts for everything. Put them in a box each year and store them. Do not ever throw anything away. You will get all sorts of advise on how long to keep a receipt, but until you need them, you will never know.

And if/when you get audited, providing the auditor with a nice place to conduct his audit, will go a long way on making it a more pleasant experience.

Mike
 

Road Dog

Member
The best approach if you own a small business and race karts is to advertise the business on the kart. Then you can deduct the reasonable advertising expenses. But keep the amount reasonable and comparable to other advertising methods. Advertise on the trailer, too, and display the trailer and/or kart at the business from time to time (with documentation of this) to prove it is a legitimate advertisement expense.

The "hobby loss" rules as referenced above do not allow continuous losses because at that point it's not a legitimate business endeavor.
 

nogoats

New member
There is some very good advice in these posts. You should first and foremost ask your accountant, not your friends or people on the internet. You don't want the get the government involved in your life if at all possible.
 

sCREamnClones

New member
Jr,

Be very careful what you try to write off. And remeber, everything you buy out of state that you didn't pay taxes on, you must fill out a sepertate form and pay taxes for as the end user ;)

Keep receipts for everything. Put them in a box each year and store them. Do not ever throw anything away. You will get all sorts of advise on how long to keep a receipt, but until you need them, you will never know.

And if/when you get audited, providing the auditor with a nice place to conduct his audit, will go a long way on making it a more pleasant experience.

Mike
Will the little room in the back yard w/the cresent moon on the door surfice?
 

alvin l nunley

Site Supporter
Will the little room in the back yard w/the cresent moon on the door surfice?
You laugh but, if you're using your garage for your business, a percentage of your house payment, based on the square footage, is deductible. At least it was for me, things might have changed.
 

pitcrew68

Member
You have to show a profit in any bussiness every 5 years or it is ruled a hobby, Unless you are winning massive amounts of money and the tracks are sending you 1099's don't waste your time. It's not worth the hassle if uncle Sam comes knocking at your door. It's funny how there are actually accountants out there that real don't know the answer sometimes.
 
screamnclone wrote:
Will the little room in the back yard w/the cresent moon on the door surfice?
********************************************************

Only if you want him/her to make your life more miserable than it is by dealing with an audit ;)

Residing and conductig business in the same state JR now resides in........I have twenty plus years of experience dealing with the Illinois Department of Revenue in the karting field.

Two best pieces of advice JR will get:

Save EVERY receipt you ever get related to ANYTHING to do with your hobby/business.

Don't think you know everything.......a lawn mower and a soda machine were the worst headaches for me and one of my competitors.........whooda thunk !
 

karter25

New member
You laugh but, if you're using your garage for your business, a percentage of your house payment, based on the square footage, is deductible. At least it was for me, things might have changed.

You open up a big can of worms when you do that. If and when you sell the home, your kart deductions will figure into your tax liability on the sale of the home. Even if it is years later in many instances.
 
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