You do not need the license, per se. There is no IRS
requirement for it. However, if you are audited regarding
this business, you will need to prove that this is a legit
attempt at operating a profitable business. A business
license is one small part of that proof. By the way, in most
cities, this is an inexpensive task.

RicRusso

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<navcole[at]yahoo.com> wrote:

- quote -

Well, I'm glad you're not pursuing a side career as a logic
instructor, ethics expert or tax advisor. How in the world
do you think you make money at a side business and wind up
with a deduction? Make more money, pay more taxes. Gladly,
I might say, because you'll still have more money in your
pocket after taxes than you did before you earned the money.

- quote -

Ask City Hall whether you need a license. If you have to
pay for a license, it's a Schedule C deduction. If you
don't have to pay for one, what is this deduction you're
looking for?

--
Phil Marti
Clarksburg, MD

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navcole[at]yahoo.com wrote:

- quote -

The primary purpose of a business should be to make money.
You will then be taxed on the funds earned less your
legitimate business deductions. The IRS does not look kindly
on a business set up for the express purpose of losing money
so it can generate more in tax deductions than it generated
in revenue.

As for a business license, that is a local issue that should
be discussed with your city or county government. Failure to
get a required license could subject you to fines. Having
said that, most consulting type businesses that do not have
customers visiting the work location do not need a license.
But, your local situation may be different so it is wise to
check with your local government.

Vic Roberts
Replace xxx with vdr in e-mail address to respond directly.

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I am a computer network engineer and would like to search
for projects to work part-time. My primary purpose is to
make money and then get tax deduction. Do I have to get a
business license through local city? If I don't, will I
still get to claim tax deduction?

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