Question about taxes and photography gear and depreciation of it?

Did I read this correctly that I can write off a depreciated value of all my camera gear on my taxes? You never know what you can believe online, hence me asking here. Tax session is still far away, but this got me curious. What are the guidelines to being able to write off your camera equipment legally and ethically?

Once you get a tax license and are earning money in photography, yes you can. The amount varies, so you'll need to speak to a local expert.

HTH

You talking about a business license?

Kenya See wrote: You talking about a business license?

Yes, once you get yourself registered as a business, that is when you can include anything you buy for your photography business in your taxes.

Hiccup..

Some call it that. You have to be licensed to collect taxes. Then you have to give them to the state and county (and/or city).

I let someone else handle that for me.

My tax consultant tells me there is an "income threshold" that triggers your requirement to be able to write off expenses against earnings. Below that limit, it is considered a "hobby" and not deductible. That is for federal taxes. Local and state requirements vary regarding when you need a license and whether your services are taxable (in some states only "products" are taxable but not "services" - ex. get an oil change on your car and the oil and filter are taxable but the "change" is not). Other charge no taxes and other tax all services.

Remember that income is taxable and at some threshold you will need to pay "payroll" taxes (FICA and Medicare) in addition to income tax. Any write offs will be against income.

I concur that you need to consult a tax preparer or tax lawyer to determine your status.

Really good information, thanks everyone

Baydream wrote: My tax consultant tells me there is an "income threshold" that triggers your requirement to be able to write off expenses against earnings. Below that limit, it is considered a "hobby" and not deductible. That is for federal taxes. Local and state requirements vary regarding when you need a license and whether your services are taxable (in some states only "products" are taxable but not "services" - ex. get an oil change on your car and the oil and filter are taxable but the "change" is not). Other charge no taxes and other tax all services.

Remember that income is taxable and at some threshold you will need to pay "payroll" taxes (FICA and Medicare) in addition to income tax. Any write offs will be against income.

I concur that you need to consult a tax preparer or tax lawyer to determine your status.

Any idea of what that figure is?

Rawley Photos wrote:

Baydream wrote: My tax consultant tells me there is an "income threshold" that triggers your requirement to be able to write off expenses against earnings. Below that limit, it is considered a "hobby" and not deductible. That is for federal taxes. Local and state requirements vary regarding when you need a license and whether your services are taxable (in some states only "products" are taxable but not "services" - ex. get an oil change on your car and the oil and filter are taxable but the "change" is not). Other charge no taxes and other tax all services.

Remember that income is taxable and at some threshold you will need to pay "payroll" taxes (FICA and Medicare) in addition to income tax. Any write offs will be against income.

I concur that you need to consult a tax preparer or tax lawyer to determine your status.

Any idea of what that figure is?

I don't recall the number but I think it may be on the IRS site OR call a tax preparer (they are not as busy this time of year and may welcome a human contact ). I'll see if I can find the figure. (Thinking back, it may have been a figure of when to file as a business vs as an individual.) I need to talk to Doug again.
I couldn't find the reference on the IRS site but lots of other requirements.
Deductions for "Not for Profit" activities go on line Form 1040, line 2 and are limited to income AND you must itemize.
www.irs.gov/newsroom/article/0,,id=169490,00.html

You also need to file in quarters, which is a PITA. I have had to do this in the past for some of my independent labor in construction. Which is why I stopped doing it years ago. Hopefully they will do the Flat Tax or Fair Tax in the near future to get rid of all of this crap. If you are not doing it professionally you are SOL for writing your equipment off.