"Jeanne" <to.eulogize[at]gmail.com> wrote

- quote -

Legally - you do have to report the income, no matter how small.

- quote -

There is no increased chance of audit based on being
artists. The types of (and amounts of) expenses claimed may
cause an audit, but if they are legitimate expenses, and you
have the doccumentation, be fearless.

- quote -

Section 179 expensing of assets is limited to income, so it
depends on where things stand. Section 179 can't create a
loss (meaning negative income), but it can take things down
to $0 in certain circumstances.

--
Paul Thomas, CPA
paulthomascpapc[at]bellsouth.net

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Thanks everyone. I claimed it all, and my tax
liability/refund ended up being the same.

Jeanne

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

- quote -

But in her post she talked about her *husband*. So assuming
they are filing a joint return, unless he also has very
little income, they will be over the filing threshold and
she will have to claim that $300 as income.

And if she's not filing a joint return, she probably should,
since with one spouse earning almost nothing, a joint return
will almost definitely save them more in taxes over a MFS
return than the tax on the $300 will be.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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

In her other post, about writing off wages, she refers to
her husband. If that was her only income, then it would
almost certainly be better for them to file jointly to take
advantage of the joint rates, etc. If they do, she has to
report her income. She just doesn't have a liability for
self-employment taxes.

Lanny K. Williams, CPA
Nawarat, Williams & Co., Ltd.
Income Tax Services for Expatriate Americans

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Seth Breidbart wrote:
- quote -

OUCH! Seth. 300 may be under the SE tax threshold,
however.....

remember, filing requirements are based on gross income
anyway.

ChEAr$,
Harlan Lunsford, EA n LA
thu 9 Mar 2006 [at] hh

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"Jeanne" <to.eulogize[at]gmail.com> wrote:

- quote -

But, unless I'm confused, you also have a dancing husband
and you file a joint return. Thus, you file a Schedule C
for your $300 even though alone you would have no filing
requirement. The alternative is for your husband to file
Married, Filing Separately.

You will have no self-employment tax for the year, but your
income is still subject to tax if you file a joint return.

--
Phil Marti
Clarksburg, MD

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Yep. That was my income. Sad, but true.

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You have to include the $300 in income. You can put it on a
Schedule C if you have business expenses to deduct otherwise
declare the income as Other Income and skip the Schedule C
for this year. You can go back to a Schedule C next year if
your business income increases.

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Rich Carreiro <rlcarr[at]animato.arlington.ma.us> wrote:
- quote -

$300 is below the filing threshold.

Seth

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"Jeanne" <to.eulogize[at]gmail.com> wrote:

- quote -

What makes you think that? Yes, you have to claim it,
unless that $300 was the only income you had for 2005, in
which case you have no filing requirement. If you do have
to file a tax return, you have to include the Schedule C
income, even though you'll owe no self-employment tax.

--
Phil Marti
Clarksburg, MD

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<cut> Now, legally I don't need to claim the income <cut
Sorry, but as a CPA the threshold for declaring income is
0.49 - because that is rounded down to 0 and .50 is rounded
up to 1.

Unless the Internal Revenue Code has been changed very very
very recently allowing for taxable income to not be reported
your $300 profit needs to be reported.

Rgs,

Mark

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"Jeanne" <to.eulogize[at]gmail.com> writes:

- quote -

What do you mean by "legally I don't need to claim the
income"? What do you believe your grounds are for not
claiming it?

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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Last year I had a profit of $1275 for a small service
business. I had a baby, and this year I have less that $300
(including a few write-offs). Now, legally I don't need to
claim the income, but because I intend to have more income
next year, should I just claim it? Does it look bad to skip
a year? We are a family that has several self employed
income streams, including performing. So, we are at risk
for auditing anyway as artists.

Here is another question. We started a video business and
have had a little income. (Again, just a little). However,
we bought an expense computer which we use primarily for the
business.) Do we write it off even though we will show a
loss? All of our other businesses have profits, albeit
small.

I'll take any suggestions.

Jeanne

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