Things to do this Week on the Coast!
Today I got the best prescription from my doctor. He told me to go walk on the beach to cope with some cramping I've experienced in my right foot. Best advice I've gotten in a long time! Sometimes we forget how fortunate we are living so close to the Gulf of Mexico. A quick drive south finds me on Dauphin Island reliving memories from my childhood.
#1 Thing to do this week - visit one of our BEACHES. They all offer different experiences. Dauphin Island is more nature driven and less commercial. Click here to watch a video I took on the island at the Audubon Bird Sanctuary. On the opposite side of the spectrum is Orange Beach with every tourist attraction imaginable. Pack your sunscreen and head out to soak up some Vitamin D.
#2 Thing to do this week - Head to Downtown Mobile! Look at all of the things The City of Mobile's Parks & Rec has going on this weekend and next! Click here for more information. Grab a bite to eat at Debris on Dauphin while you are down there! Some of the best po-boys in Mobile!
#3 Thing to do this week - Visit OWA's Tropical Falls Water Park! This family friendly venue has something for everyone! Click here for more information! The park is located in Foley, Alabama in Baldwin County! This is the perfect place to cool off in our summer heat.
#4 Thing to do this week - Brunch at The Grand Hotel Resort & Spa in Point Clear, Alabama for a memorable experience. I grabbed this description from their website! It looks wonderful! Make reservations through Open Table!
#5 Thing to do this week - Do you want to feel good? Spend some money with local businesses! Your investment in them is an investment in your community! Buy your coffee from Dr. Mike at RedBar Espresso on Old Shell. Shop for new walking shoes with Aaron at Run-N-Tri off of Airport. Pick up a bottle of wine from Brooke at Domke Market. Buy a wonderful candle from John at Monet Candles on Schillinger! Take your pet for a groom at Apollo's Paws. Local owners are truly grateful for your business!
New on YouTube!
Join me this Sunday, July 9th at 2PM for the first episode of The Great Crab Cake Recipe Adventure. I am in search of the best recipes for this family favorite. In this video I will cook crab cakes inspired by Mr. B's in New Orleans. It was published on nola.com as one of the top crab cakes in the city. Enjoy this simple to make appetizer! Click here to watch on Sunday!
Business or Hobby?
Richard Lindsey's "Real World" Personal Strategy Note When Does My ‘Hobby’ Become a ‘Business’? “Where there is love and inspiration, I don't think you can go wrong.” - Ella Fitzgerald
Do what you love, they say, and you’ll never work a day in your life.
Love it enough and do a good enough job, though, and sooner or later you have to think about taxes. But it can be a little unclear at what point your “hobby” technically becomes a “business.”
…And how long you have before Uncle Sam starts asking, Where are your profits? And where are your income taxes?
Let’s find out — including what’s new in the legislation for this year and whether you should try to graduate to a “business” at all.
True or false
Many people — especially in these days of the exploding gig economy — finally try their hand at making a few bucks in their spare time with an interest or outright obsession that they know somebody will pay them for eventually.
They also often embrace the notion that if you have business expenses, you can always deduct them on your taxes.
First, let’s establish something: The IRS is crystal clear on what makes a business and what makes a hobby. False.
The IRS book, Activities Not Engaged in for Profit Audit Technique Guide, admits “it can often prove highly difficult to figure out the difference between a legitimate business that is devoted to making a profit and an activity that is not.”
(As you can imagine, fuzzy language usually doesn’t help the taxpayer …)
Basically, though, when we say a hobby grows into a business, we mean (for tax purposes) a small business. Small-business income, losses, and expenses are filed on the IRS Schedule C, “Profit or Loss From Business (Sole Proprietorship).”
Right now, business losses are deductible and losses from a hobby aren’t (though this might change a few years from now). So it’s important you qualify as a business — and that you can prove it — if you want tax deductions for losses and expenses.
Nine key details
So, how do you know? The IRS says you have a business if you …
Carry out the activity “in a businesslike manner” and you keep complete and accurate books and records.
Put in the time and effort to show you intend to make a profit.
Depend on income from the activity for your livelihood.
Suffer losses due to circumstances beyond your control or those normal for the startup phase of the business.
Change operations to improve profitability.
Have advisors with the knowledge needed to carry out the activity as a successful business.
Were successful in making a profit in similar activities in the past.
Make a profit in some years.
Expect to make a future profit from the appreciation of the assets used in your activity.
(Note that none of the above nine is more important than the others. We can help you document all of them.)
As we said, if you do have a business, you have to go through the time and trouble of filing (and justifying) your Schedule C. Generally, declaring a loss three years in a row is a sketchy red flag, and the IRS could disallow your tax deductions. This is also known as the “five-year rule.”
Keep this in mind
As well as those who try to declare businesses as loss ventures and take deductions too many years in a row are those who treat their business/hobby as a tax-free source of income. I can already tell you this is a bad move because the IRS is crystal clear on taxable income: If you make it, you pay tax on it.
Especially this year: If you make just 600 bucks in business income off the likes of eBay or you get paid at least that amount via PayPal, Venmo, and similar platforms, the IRS is going to know about it. You’re going to get an IRS Form 1099-K — and they’ll expect you to declare that money.
There’s been some legislation tossed around to increase that threshold to way more than 600 dollars, but so far it’s gone nowhere. We’ll keep you posted — and check with us to see if you should be paying estimated quarterly taxes or if you can have more withheld on your primary job to make up the taxes on your extra income.
So… hobby or business? Can you deduct or not?
Here’s a very simplified guideline:
Are you willing to have no deductions available and just pay taxes on whatever cash comes in? Hobby.
Are you looking to make a profit, even eventually? Work many hours? Are you keeping good records of income and expenses? Business — with all the deductions, and responsibilities, involved.
Lindsey & Waldo, LLC
"You see the numbers, we look for the opportunities"
(251) 633-4070
What's on Your Nightstand?
I became fascinated with Indian culture after visiting one of my sisters when she was a student at Mississippi State. I was only about 10 years old and she invited me to stay with her for a weekend. She was studying foreign languages and belonged to a foreign language club on campus. Many of the students were in the States on exchange. This was my first encounter with anyone from India. One young man, named Sid, spent some time with me. He told me about his homeland. I remember his peacefulness more than the words he spoke.
Decades later, I decided to read Autobiography of a Yogi. Paramahansa Yogananda brought the ways of the yogi to the west. His story details his life journey from a young man in Calcutta to his life in the States. I am intrigued by the abilities of yogi masters in India. He recounts numerous tales of the mystical powers associated with this culture. I certainly suggest this one to anyone who is interested in what is possible for humans. Available on Amazon, your local library and where books are sold.
Your personality creates your personal reality.
If you want to change your reality begin by changing your personality. Are you a constant complainer? Change that trait by listing out the things you are grateful for daily. Are you self-defacing? Write a list of 100 things you love about yourself.
If those practices don't send you down a new path try this exercise from Louise Hay. She founded Hay House publishers when she was 60 years young.
Find a photo of yourself when you were a young child. Place it on your bathroom mirror. Think about how you would treat that child (you) if he or she was your child. Begin treating yourself in the loving way that you would treat your own child. It is a magical assignment.
Have a wonderful week and remember to spread your love and light to the world! ~ Charlsie
Comments