Harlan Lunsford wrote:

- quote -

I'm sure there are many "hobby" activities that go
unreported and simply fall between the cracks. Still, that
doesn't mean that there isn't some framework under which the
"legal" approach to the taxation of these activities can be
analyzed. (Indeed, if the answer to all problems is to
simply omit the information from your return, then why the
heck do we have THIS newsgroup? <g> )

There are two issues that I believe come into play. The
first is the concept of "regular and continuous" activity.
The second is whether the expenses incurred qualify for a
deduction and/or are spent in an activity for which an
exemption might normally be granted. On this second point, I
suspect that the activity you mentioned probably would
qualify as an exempt activity if you went to the trouble of
applying, etc. However, the activities of the original
poster probably would NOT qualify for an exemption or
deduction UNLESS some very specific circumstances were met.

And, by the way, perhaps it is relevant to note the
"guidance" that the IRS recently provided to charities
during this election year:

http://www.irs.gov/newsroom/article/...122887,00.html

MTW

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Harlan Lunsford wrote:
- quote -

You are quite fortunate that you do not live in the City of
Richmond. A majority of the population thinks that if
someone does not think Gen. Lee is a war criminal they are a
raciest. Do not bring up facts they will only get in the
way!

--
Frederick E. Jorden http://Tax-Accounting-Payroll.com
7825 Midlothian Tpk - 207 Richmond, VA 23235-5247
EMAIL knowtax[at]bigfoot.com
(804) 320-6210 FAX (804) 320-6211

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Harlan Lunsford wrote:

- quote -

Ah do believe that The War of Northern Aggression is the
more appropriate term.

You raise an interesting point. Unfortunately it does not
change anything because at Audit time you may be asked to
produce records so that the auditor can determine if you
used any of those funds for personal expenses.

There is also the problem of comingling funds. Years ago
I was Treasurer of a reasonable size organization whose
revenues were limited to annual dues and whose expenses were
limited to reimbursement checks to the newletter editor.
When I announced I would be opening a checking account for
the organization, several people asked why I did not just
keep it in my checking account like other Treasurers had.

It still comes down to good recordkeeping.

Dick

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Paul A Thomas wrote:
- quote -

Well, I think I've read everything everybody has said thus
far.

As much as I DETEST the activity in which the OP is engaged,
I don't see how any money received just has to be either a
gift, or hobbby income, OR SE income, i.e. a business.

I've considered asking others for help with expenses that I
might incur with shoring up Confederate gravestones,
refurbishing old cemeteries, and otherwise celebrating the
warriors in that Late Unpleasantness, i.e. the War of
Northern Aggresion. And if I did solicit and receive help
with these expenses, that help would have nothing whatsoever
to do with my tax return. 'nuff said.

Confederate Cheers for the Bonnie Blue flag.
Harlan Lunsford, EA n LA

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Drew Edmundson <drewsbeagles[at]hotmail.com> wrote:

snip

- quote -

This should have said:
I don't buy the gift argument some are making, you are
soliciting these monies in exchange for services so they
aren't gifts.

snip

Drew Edmundson, CPA (NC)

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Drew Edmundson wrote:
- quote -

That's correct. I'd forgotten that was true for nonprofits
as well as other corporations, but California law allows
corporations with only one director.

- quote -

Or a trust. If an object is to influence legislation, it
might not qualify as a 501(c)(3), but I don't know off the
top of my head.

- quote -

The only resources that are required to create a nonprofit
is the filing fee that goes to the IRS for reviewing the
application. It's usually $500.

Stu

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chiefthracian <zkrahlin[at]myrealbox.com> wrote:
- quote -

Bull. People are giving you money because you're doing X
and promise to do more of it, and even more than that if you
have more money. To me, that's income from doing X.

Seth

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chiefthracian <zkrahlin[at]myrealbox.com> wrote:
- quote -

From this comment I would suggest you haven't investigated
it thoroughly. Only one entity is required to own a
corporation. But a nonprofit doesn't have to be a
corporation, it can be an association (which would require 2
or more). A nonprofit in NC can be formed for a couple of
hundred dollars.

- quote -

I don't understand this. The IRS doesn't have a minimum
capital requirement for a nonprofit. For a charitable with
less than $5,000 in annual receipts an application isn't
even required.

- quote -

I believe you are assuming things about me that are not in
evidence. $500 is not a drop in the bucket for me either.
While I am doing better than you say you are, I am not
wealthy. The offense I took was to the word
"incomprehensible" not to the rest of the sentence.

I fully comprehend what you are saying, I just believe you
are confused. If you don't form a nonprofit then you are in
a business with all the resulting requirements. It just
seems in the long run that a couple hundred dollars to form
a nonprofit would be cheaper than all the hassle and other
expenses you are going to continue to experience.

I don't buy the gift argument some are making, you are
soliciting these monies so they aren't gifts. So either you
report the income and allowable expenses on Schedule C or
you really are operating a hobby. If you are a hobby then
you report the receipts on the "other income" line and the
expenses as miscellaneous itemized deductions subject to the
2% haircut. Based on the limited income you have; I assume
you aren't itemizing so the monies you receive are going to
be included in taxable income with no offsetting deduction.

So if you owe income tax now and collect $1,000 to support
your activism then you probably owe $100 to IRS and
depending on your state maybe another $50 to $80 to them.
So in year 1 you save enough on income tax to pay to form
the nonprofit corporation (at least here in NC).

Drew Edmundson, CPA (NC)

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"chiefthracian" <zkrahlin[at]myrealbox.com> wrote
- quote -

Money received for an act you do ~IS~ income, and earned
income at that.

- quote -

I don't think the IRS or California would see it that way.
Gifts have no connection to acts you do.

--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net

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chiefthracian wrote:
- quote -

I don't think so. I believe it was ALWAYS the case, but
only ENFORCED starting some years ago.

- quote -

Doesn't seem a relevant distinction. Money would be given
to you with the intent it be used for your lobbying
activities.

For a more complex relevant hypothetical -- some you went
around the neighborhood asking if they wanted their lawn
mowed. For those who did, if did it, and THEN asked for
money, the money is still income.

The money is for the activity.

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Dick Adams wrote:

- quote -

advice they are given.

- quote -

3. Howard Dean took the advice of his advisors.

- quote -

He also needs somewhat of a reality check. Just because he
wants sometheing to be a certain, and that it seems
reasonable to him that it should be, does not justify him
rejecting all information that does not conform to his view
of how things ought to be.

That kind of attitude may help (to an extent) him as an
advocate, but it does not serve him well in any other
context.

- quote -


Stu

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chiefthracian wrote:
- quote -

For tax purposes income is not limited to that.

- quote -

That's the issue. If you beg on the street for no
particular purpose but to put food in your mouth, what you
receive would likely be a gift.

But if you solicit money based on the fact that you plan to
use it to help in your advocacy activities, it could be
construed that the donor gives it to you in exchange for
your services, even if he, personally, doesn't get anything
directly from your activites. In that case it may well be
considered taxable income.

- quote -

Hate to tell you, but unless you have an employer, and
assuming you receive what the IRS would consider income
other than as a gift, you are self-employed.

- quote -

Again, that is the issue. If it's considered a hobby, you
may not be entitled to deduct all your expenses, so you may
end up with taxable income even if there is no money left
over.

Stu

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chiefthracian wrote:
- quote -

You came in here asking a question. You received some
excellent information and advice that wasn't consistent with
what you wanted to hear, so you have rejected it.

Why bother?

Stu

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"Arthur L. Rubin" <ronnirubin[at]sprintmail.com> wrote:

- quote -

That was not the case til the law was changed some years
ago. However, the waitress was already employed, and these
tips relate directly to her job as waitress. So I hardly
think the same rule can be applied in my case...for I am not
presently employed in the same field I'd be receiving
donations.

- quote -

Again, no way could my freelance volunteer work be
considered lobbying. So that is also eliminated as one of my
tax issues.

--
Zeke Krahlin, chiefthracian -ICQ#: 277447464
Lavender-Velvet Revolution
http://www.gay-bible.org

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Ooops...where I said:

- quote -

I meant "now" instead of "not".

--
Zeke Krahlin, chiefthracian -ICQ#: 277447464
Lavender-Velvet Revolution
http://www.gay-bible.org

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Drew Edmundson <drewsbeagles[at]hotmail.com> wrote:

- quote -

A corporation's a corporation. You need at least two to
start one. I don't have any contacts that I'd trust enough
to go in on this. So what I need to do, is persevere until I
can finally impress some people or organization that will
then assist me in doing just that: found a non-profit. That,
or including me as an asset to their group, and employing me
for my expertise.

- quote -

I have. Too many assumed resources are required, which I
don't have at this time. But I am so driven with my
avocation as an activist, that I have total confidence in my
ability to make it flourish one way or another.

- quote -

Try coming from a direction of very low income, and
consulting tax and legal resources. Most can't wrap their
brains around anyone who does not have the assumed
resources. For them, $500 is a drop in the bucket, and they
can't conceive that I couldn't afford to just shell that out
at the drop of a credit card.

So if YOU take offense at my plain observation, then you can
imagine how much offensive attitudes I've had to put up
with, by classist attitudes. They have no concept of
approaching a goal from my low-income level...without
wrapping it all up in a package that turns out to be rather
expensive...something that would require you to already be
receiving monies totalling at least $20,000 annually.

I *know there are other ways to achieve my goal, than
that...and I am not pursuing it. And one of the issues I
need to clear up as I make my next few steps, is the
possible tax issue.

--
Zeke Krahlin, chiefthracian -ICQ#: 277447464
Lavender-Velvet Revolution
http://www.gay-bible.org

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"MTW" <mtwingcpa[at]yahoo.com> wrote:

- quote -

trees for the park service, is lobbying for ecology.

My gay activism is my own doing, I do not belong to any
partcular group. It is my hobby ("avocation" as opposed to
"vocation"). Just because it has political aspects, does not
mean I'm lobbying for my cause. Just as the volunteer
planting trees is not lobbying for the park's political
agenda.

--
Zeke Krahlin, chiefthracian -ICQ#: 277447464
Lavender-Velvet Revolution
http://www.gay-bible.org

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sethb[at]panix.com (Seth Breidbart) wrote:

- quote -

But I will not be getting ANY income from doing X. I do X
entirely free. I just need more money than I personally
have, to do X even better.

--
Zeke Krahlin, chiefthracian -ICQ#: 277447464
Lavender-Velvet Revolution
http://www.gay-bible.org

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cj.green[at]worldnet.att.net (Christopher Green) wrote:

- quote -

I'm not coming from that direction, however. I am not
running a lucrative business, looking for legal loopholes,
such as a professed hobby.

I'm coming from the other end: unemployed, living on small
disability stipend...pursuing activism as my great
dedication of many years. So I'm looking for some way to
generate more resources, to be more effective. I have the
talent and expertise, but lack the money. So it occurred to
me to ask for donations...and thus, I began posting some
questions in tax newsgroups.

So there is nothing to audit me on, regarding a business or
employment. Ergo, no need to disallow.

--
Zeke Krahlin, chiefthracian -ICQ#: 277447464
Lavender-Velvet Revolution
http://www.gay-bible.org

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Paul A Thomas" <taxman[at]negia.net> wrote:

- quote -

Ahh, but aren't YOU commingling the issue, by calling
donations for my hobby as "income"...where income should
really mean monies received for carrying out some work for
another?

Donations for a hobby would not be income, but "gifts,"
right?

- quote -

Okay, well, I'm not self-employed with this. And profit will
not be an issue...as all donations include monies received
will be funneled directly towards my hobby. There will never
be a chance for profit, anyway, as I'm sure my financial
needs for this hobby will always outweigh what people
donate. (Unless I get real lucky, and folks start donating
thousands of dollars annually...in which case I can easily
shift into self-employment status. But this is just
conjecture over a very unlikely outcome.)

Thanks again for you input.

--
Zeke Krahlin, chiefthracian -ICQ#: 277447464
Lavender-Velvet Revolution
http://www.gay-bible.org

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