Purchasing photography equipment for business and taxes...

[tbotello]

Hello, I wasn't sure where to post this. I assumed this forum was my best choice and I've searched around and haven't found anything related. Forgive me if I've missed a previous post. I'm beginning a photography business as I've done jobs for many people and taking it to the next level, and while I'm sure I'll have many questions related to it, this post will be focused on "business" related purchases and claiming those purchases at the end of the year. I'm not planning to go crazy and start buying all of this equipment thinking I'll get it all back in a return, but what should I expect? I know it varies depending on which state you live in. I know I need to do a lot more studying on this, but as with all of my other photography needs, I turn to you all for your experience.

So, if any of you have experience on "writing off" your equipment purchases for your business, please share. And do note, I'm not trying to cheat the government out of anything, I'm genuinely curious. I've just heard of some perks of purchasing gear for businesses and would like a better knowledge of said perks. Thank you in advance.

[GadgetRick]

Well, with any advice like this I suggest contacting a trusted cpa. Anything we give you here may (or may not) apply to your particular situation.

With that said, I've itemized for many years for various businesses. Yes, you can write off equipment you purchase for your business, however, different types of equipment are written off (or down) differently depending on various factors. So you have to be careful.

Also, you must prove you are, in fact, operating your business for profit purposes. This doesn't mean you have to show a profit...at least at first. Just means you have to legitimately be trying to earn money at the business.

Some things you may be able to write off include but may not be limited to:

-equipment
-various supplies
-postage
-any trade publications associated with your business
-entry fees to various shows which will help you with your business
-mileage associated with the business
-entertainment associated with trying to obtain business

There are many other things you may be able to write off, however, you do need to speak with a tax professional to be sure. You really don't want to be caught in an audit if you can help it.

[zona5101]

additionally, moving your gear from personal property to business property will eliminate your gear from coverage under your homeowners insurance policy. You will want to insure it separately.

[Jim Bryant]

I cheat the government every year and get all my money and then some back. Actually, all my gear from computers, software, printers, supplies, cameras, lenses, studio lights, backdrops and every thing else such all expenses, food on assignment, mileage, car expenses, gas, oil, tune ups, repairs, tires and even AA batteries I claim on expenses. Along with what GadgetRic added.

[lynnmm1961]

I second talking to a tax spe******t. The tax rules vary greatly from country to country.

[Jim Bryant]

At the end of the year, I tally up expenses and such and take to my CPA and he does the forms and tax return. I think I pay him $225.00 a year for those services, which are also expenses I write off as well.

First you need to have a registered business. Then, you will need a tax ID #, state and most likely a FEIN.

Kinda hard to write off something if they don't know you're doing it.

[GadgetRick]

Originally Posted by maxharvard

First you need to have a registered business. Then, you will need a tax ID #, state and most likely a FEIN.

Kinda hard to write off something if they don't know you're doing it.

Not true. You need to have neither to write off things for business. It might help to have them should you run into any problems but it's not required. I've done this for years without either (well, we had these for my wife's business) and never had a problem.

I asked my accountant about this, he explained until you're making a decent amount per month (say $2-3k) you don't need to worry about that.

Also, if you do contract work, and get a 1099, you can also write off expenses. I do that, too.

[SilverBullet07]

Originally Posted by maxharvard

First you need to have a registered business. Then, you will need a tax ID #, state and most likely a FEIN.

Kinda hard to write off something if they don't know you're doing it.

A lot of states dont require a Tax ID # nor is a FEIN required under certain conditions. If your doing business under your legal name and not a corperation, not doing businesss as (dba) or limit liability company, no employees, or don't need a checking account associated to the business, a FEIN may not is required because they can use the SSN to track.

Registration on these occures when you submitt you end of tax year forms.

Some local counties or states may not require tax id either but you would need to read up on their rules which should be on their websites.

Originally Posted by GadgetRick

Not true. You need to have neither to write off things for business. It might help to have them should you run into any problems but it's not required. I've done this for years without either (well, we had these for my wife's business) and never had a problem.

I asked my accountant about this, he explained until you're making a decent amount per month (say $2-3k) you don't need to worry about that.

Also, if you do contract work, and get a 1099, you can also write off expenses. I do that, too.

Originally Posted by SilverBullet07

A lot of states dont require a Tax ID # nor is a FEIN required under certain conditions. If your doing business under your legal name and not a corperation, not doing businesss as (dba) or limit liability company, no employees, or don't need a checking account associated to the business, a FEIN may not is required because they can use the SSN to track.

Registration on these occures when you submitt you end of tax year forms.

Some local counties or states may not require tax id either but you would need to read up on their rules which should be on their websites.

Legalities aside, it would be helpful to maintain some semblance of legitimacy.