|
|
 Extreme Veteran
Posts: 338
 
Location: NE TX | Just saw another user post about their taxes, just wondered if when filing taxes if y'all claim your horse expenses. I know it can become a mess if you do cause you have to claim all winnings, all fees, keep track of miles and everything. Just wondering who does or does not and your reasoning why.
|
|
| |
|
  That's White "Man" to You
Posts: 5515
 
| Generally if you win anything substantial the producer will send you a W9. I dang sure am going to claim my expenses if I have to pay on the income. |
|
| |
|
 Owner of a ratting catting machine
Posts: 2258
| The only times I claim my expenses is if I have substantial earnings or if I sell any horses. If I sell, then I claim the sale and submit expenses to mirror it. |
|
| |
|
 Expert
Posts: 5293
| Yes I do! My horses and Rodeo is a Business. Meant to make a profit. I pay taxes on EVERY dollar I win and I also deduct entry fees, vehicle, feed, vets, farrier, etc. You have to show 2 years of profit every 7 years. |
|
| |
|
That's White "Man" to You
Posts: 5515
| The 2 year profit is not true. If you are doing it with the intention of making money, you are entitle to deduct the expenses. |
|
| |
|
Expert
Posts: 5293
| Whiteboy - 2017-11-03 9:50 AM
The 2 year profit is not true. If you are doing it with the intention of making money, you are entitle to deduct the expenses.
My accountant is a former IRS agent... lol I just go by what she says and by the book. |
|
| |
|
That's White "Man" to You
Posts: 5515
| FLITASTIC - 2017-11-03 12:23 PM
Whiteboy - 2017-11-03 9:50 AM
The 2 year profit is not true. If you are doing it with the intention of making money, you are entitle to deduct the expenses.
My accountant is a former IRS agent... lol I just go by what she says and by the book.
If I were you, I'd find a new accountant. |
|
| |
|
| I've done it and I've survived 2 audits! LOL They are not as bad as you may think.
If you do it year round and earn money than it can be considered a business, but you have to make sure you treat it like a business. File a schedule C and make sure you keep very accurate records and a separate checking account. They asked me for show flyers, mileage records for my truck, receipts for any related purchases like tack, clothing, etc.
The auditor told me that if I could not show some type of profit within 5 years than it was better for me to show it as a hobby until I could show a consistent profit. I could still write off my expenses, but only up to the amount I won. Honestly, this is really the way to go unless you are competing at the professional level, or actually training horses.
|
|
| |
|
Location: Not Where I Want to Be | Whiteboy - 2017-11-03 2:15 PM FLITASTIC - 2017-11-03 12:23 PM Whiteboy - 2017-11-03 9:50 AM The 2 year profit is not true. If you are doing it with the intention of making money, you are entitle to deduct the expenses. My accountant is a former IRS agent... lol I just go by what she says and by the book. If I were you, I'd find a new accountant.
This
|
|
| |
|
 Coyote Country Queen
Posts: 5666
| If you are going to claim horse stuff, make sure you find an accountant that is knowledgeable about this kind of stuff. I use Quickbooks to record all of our income and expenses, then turn it over to our accountant. |
|
| |
|
Expert
Posts: 2531
Location: WI | I never have, but if I got W-2 I would. |
|
| |
|
 Saint Stacey
| If you are claiming it, you need to be treating it as a business. You can claim losses more than the 2 out of 7 years as long as you can prove it is a legit business.
1) You need to itemize
2) You need a separate checking account for business only.
3) You should really get business cards
4) You need a vehicle used for business only, another one if you have a regular job.
5) You need to be sending out 1099’s to your sub contractors (farrier, vet) if it’s over...I believe it’s $1,000 but don’t quote me.
6) You need a very thorough mileage report.
Those are just a few things I can think of off the top of my head. |
|
| |
|
Meanest Teacher!!!
Posts: 8555
Location: sunny california | FLITASTIC - 2017-11-03 9:46 AM Yes I do! My horses and Rodeo is a Business. Meant to make a profit. I pay taxes on EVERY dollar I win and I also deduct entry fees, vehicle, feed, vets, farrier, etc. You have to show 2 years of profit every 7 years.
how much profit do you have to show LOL |
|
| |
|
Expert
Posts: 5293
| kwanatha - 2017-11-03 4:05 PM
FLITASTIC - 2017-11-03 9:46 AM Yes I do! My horses and Rodeo is a Business. Meant to make a profit. I pay taxes on EVERY dollar I win and I also deduct entry fees, vehicle, feed, vets, farrier, etc. You have to show 2 years of profit every 7 years.
how much profit do you have to show LOL
Actually most years I do show a small profit. |
|
| |
|
 Neat Freak
Posts: 11216
Location: Wonderful Wyoming | kwanatha - 2017-11-03 5:05 PM FLITASTIC - 2017-11-03 9:46 AM Yes I do! My horses and Rodeo is a Business. Meant to make a profit. I pay taxes on EVERY dollar I win and I also deduct entry fees, vehicle, feed, vets, farrier, etc. You have to show 2 years of profit every 7 years. how much profit do you have to show LOL
I believe any profit. |
|
| |
|
Married to a Louie Lover
Posts: 3303
| If we get w-9’s we claim enough to offset them. If we sell a horse we record enough to Offset it.
We also raise some cattle so feed and hay all get lumped together, which is nice.
Our accountant keeps us under the radar while getting us the most bang for our buck, basically. |
|
| |
|
Location: Not Where I Want to Be | SKM - 2017-11-03 6:14 PM If you are claiming it, you need to be treating it as a business. You can claim losses more than the 2 out of 7 years as long as you can prove it is a legit business. 1) You need to itemize 2) You need a separate checking account for business only. 3) You should really get business cards 4) You need a vehicle used for business only, another one if you have a regular job. 5) You need to be sending out 1099’s to your sub contractors (farrier, vet) if it’s over...I believe it’s $1,000 but don’t quote me. 6) You need a very thorough mileage report. Those are just a few things I can think of off the top of my head.
it's a weird number and it changes from time to time, so anyone that gets paid more than $500 a year gets a 1099 |
|
| |
|
Neat Freak
Posts: 11216
Location: Wonderful Wyoming | 1DSoon - 2017-11-04 6:49 AM
SKM - 2017-11-03 6:14 PM If you are claiming it, you need to be treating it as a business. You can claim losses more than the 2 out of 7 years as long as you can prove it is a legit business. 1) You need to itemize 2) You need a separate checking account for business only. 3) You should really get business cards 4) You need a vehicle used for business only, another one if you have a regular job. 5) You need to be sending out 1099’s to your sub contractors (farrier, vet) if it’s over...I believe it’s $1,000 but don’t quote me. 6) You need a very thorough mileage report. Those are just a few things I can think of off the top of my head.
it's a weird number and it changes from time to time, so anyone that gets paid more than $500 a year gets a 1099
$500 is the amount we were told to use. |
|
| |
|
 Take a Picture
Posts: 12842
| The only thing I can tell you is that you better have a receipt for everything. If you write a check for entry fees that will serve as a receipt. If you pay cash, have them write a receipt (for several reasons). Keep receipts from feed. I pay my farrier with a check. He handles his own income tax from that and would not appreciate me giving him a 1099. I pay my trainer with a check which I just go deposit in her bank account, but I have the check as a receipt. I save the toll receipts from travels to shows for mileage confirmation. I give all the information to my accountant. If you are ever audited and do not have receipts, you are toast. You need to keep this information for 7 years since IRS can go back that far. If you are ever audited they will get you every year after that for a certain period of time. A teacher just told me that yesterday when we were all standing around doing duty after school. Make sure that you have the correct IRS forms.
W-9--- the form you fill out when you go to work for someone with dependents and SS Number. Like independent contractor
W-4-- form you fill out for your employer
W-2-- the form your employer sends to you showing you total taxable income and amount of tax you have paid.
1099--- form sent to you on income that has not been taxed. Interest on savings, stock dividends, winnings at the race track, winnings from a lottery, winnings from a barrel race
I have a small breeding operation so there are more things I can take off. The account that I use has been doing my family's taxes since the mid 1930's. (or his grandfather and father have). None of us have ever been audited. Personally, I think that would be a nightmare.
Edited by streakysox 2017-11-04 2:13 PM
|
|
| |
Folks on-line