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 Veteran
Posts: 233
 
| Ok so I may be a little behind but I just found out that you can treat your horses as a hobby on your taxes. I always knew that there had to be a distinction between business and hobby. So what can you claim when you have"hobby" horse? |
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Married to a Louie Lover
Posts: 3303
 
| I got a 1099 from one of the production companies I race with so we claimed entry fees and fuel to "make it go away".
According to our accountant you have to be careful with the hobby thing. It can open a can of worms in an audit. We claim entry fees, fuel, etc when we have 1099's. If no 1099's we don't claim anything. you could probably also claim your feed and hay bills if you needed to. |
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boon
Posts: 1
| IRS wants you to treat it as a hobby if you aren't really trying to make a profit. As a hobby, you can only claim your expenses to the extent of your income - in other words, for tax purposes, you would report equal income and expense - no net income or loss. Unless you actually made money, then of course IRS wants their share.
If you're trying to make money, you're entitled to deduct your losses over and above your income.
Nearly every part time barrel racer, rodeo contestant and weekend farmer faces this issue, and for most it deserves a great deal of thought and a thorough discussion with a capable CPA. |
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| FlyingAitch - 2017-02-22 8:40 AM
IRS wants you to treat it as a hobby if you aren't really trying to make a profit. As a hobby, you can only claim your expenses to the extent of your income - in other words, for tax purposes, you would report equal income and expense - no net income or loss. Unless you actually made money, then of course IRS wants their share.
If you're trying to make money, you're entitled to deduct your losses over and above your income.
Nearly every part time barrel racer, rodeo contestant and weekend farmer faces this issue, and for most it deserves a great deal of thought and a thorough discussion with a capable CPA.
This ^^^^
I've recently been through 2 audits and they told me this same thing. After about 3 years if you do not show a profit you should show it as a hobby. You can claim a loss up to 5 years however after 3 you will show up on their radar. |
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 Expert
Posts: 3782
Location: Gainesville, TX | We do not claim the barrel racing specifically as a loss but we also breed horses and have some profit/loss there. So we claim most expenses and profit particularly related to breeding, selling, and marketing . If you are not doing this, then yes claim it as a hobby. |
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Expert
Posts: 1599
| I filed schedule F this year! Best decision I ever made! That, along with paying an accountant. Got 10X the refund literally!! |
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