domingo3[at]hotmail.com wrote:

- quote -

I don't think so. It sounds similar to painting as a hobby
and trying to claim it as a business just because you
*might* sell some of your artwork.

--
Barry Margolin, barmar[at]alum.mit.edu
Arlington, MA
*** PLEASE don't copy me on replies, I'll read them in the group ***

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<domingo3[at]hotmail.com> wrote:

- quote -

Off the cuff, this sounds like a sham to generate income for
the baby to justify the IRA. You should seek professional
advice with respect to starting a business and definitely
only do it if you have a legitimate business in mind. If
you're looking for ways to begin saving for a child's
future, there are numerous legal ways to do so.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

Here's a hypothetical situation that I'm trying to figure
out the answer to.

Let's say my friend wants to start up a baby modeling
business and is willing to pay my child $4000 for his
services.

What kind of start up expenses would he incur in the business?

What would he be required to do in order to issue the
appropriate tax document? (Not sure if it's a W-2 or
1099-MISC)

Can he get a deduction for losses if he doesn't make any
profit?

How complicated would this whole process be - maybe an
estimate in terms of man-hours. None of us have any
experience in running our own businesses at all. I've tried
searching the web, but I'm not doing a very efficient job
because I don't think I know exactly what terms to search
for.

Who's to say that my friend couldn't be starting up a
business like this? He just has to have intent to make a
profit, right?

Is there an easier solution to my situation?

Thanks much.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >