If selling guitars is not your main source of income, but you are fortunate enough to sell one, how do you account for the extra income when you do your taxes. ( cash payment not an option
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| Author: | uvh sam [ Sun Aug 31, 2014 8:22 pm ] |
| Post subject: | Accounting/tax question |
If selling guitars is not your main source of income, but you are fortunate enough to sell one, how do you account for the extra income when you do your taxes. ( cash payment not an option )
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| Author: | cphanna [ Sun Aug 31, 2014 8:59 pm ] |
| Post subject: | Re: Accounting/tax question |
I don't sell my instruments, because my limited output is for my own pleasure. HOWEVER.... I also do gallery art and sell a few paintings almost every year. They are not my main source of income. They are a hobby that pays me a bit of money each year--very much like selling an occasional guitar. I pay state sales tax on these sales and I record them as income on my federal return. Don't forget your state sales tax. If you sell an instrument, you have both a sales tax and a federal income tax responsibility. Go see an accountant familiar with the laws of your state. A reasonable consulting fee right now will save you a world of hurt down the road. You can probably buy the consultation for $100 or less. Find an accountant who plays guitar and he or she might work with you on an even tighter budget. Also, keep meticulous records. In all probability, you can deduct some of your materials expense. (You made a sale and you have cost of sales). Ask about all of this and take notes. That's why you are paying a consulting fee. TAKE NOTES. But don't take my word for any of this beyond the concept of DOING it. If you are not willing to pay a consulting fee to an accountant for good advice in your state, then you probably shouldn't be selling anything that brings you extra income. Sorry, but that's pretty much the truth of it. |
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| Author: | TRein [ Mon Sep 01, 2014 8:17 am ] |
| Post subject: | Re: Accounting/tax question |
Two words: Schedule C |
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