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Subject: Re: Writing off gear?

> Carlo Coggi wrote:
>> I am an advanced amateur photographer and will be taking an 'extreme
>> adventure' vacation this summer. A friend of a friend is editor of a
>> well-known travel magazine who heard about my somewhat unique vacation
>> and said that the magazine would be interested in seeing a spec
>> article/photos about the trip.
>> Business/Tax Question:
>> Two months ago I sold my Canon 10D and bought a 30D and some related
>> camera gear. If my photos and text are accepted for publication, can I
>> then form a sole proprietorship or corporation and *retroactively*
>> write-off the cost of my gear and trip?

If you are "in the business" of photography, then yes.
Business income and expenses flow to Schedule C and related forms or
schedules. Now, it's not as easy as just claiming "I'm in business" and
taking the losses, as this isn't a septic pumping business. This activity,
and others that carry a significant element of pleasure are highly
succeptable to IRS scrutiny (an audit), especially if if you show losses.
You actually have to turn yoru photography into a business (ie: work at it)
by getting a business license, advertising (or otherwise marketing your
photography for sale), and having more than one friend with a friend who
might consider buying one of your pictures (ie: several clients). It would
help establish your "business" if you were already published someplace
before forking over tens of thousands in gear, travel and lodging for the
opportunity to be considered for publication.

If this is just a hobby or a casual sale of some photos, then no.

Hobby income gets reported as Other Income (Line 21) with Hobby expenses
(not to exceed hobby income) flowing to Schedule A (subject to limitations).

Paul Thomas, CPA


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