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Saving tax while having fun?

Discussion in 'Business & Tax Advice' started by pmguru, May 20, 2010.

  1. pmguru

    pmguru Registered Member

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    I own a website about tourism in my home town. If I write reviews on restaurants I visit and things I do that are wicked cool like cruises and stuff then can I claim back tax? I have a business name for the website.
     
  2. Delboy2424

    Delboy2424 Regular Member

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    Occupation:
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    If you are trading as a business ie your website, then you can effectively claim/offset any incurred expenditure relevant to undertaking the purpose of the said business so if this includes payments for reviews then yes you can PROVIDING it is beyond reasonable doubt to the taxman it is not for personal gain in which case you should only claim a fair proportion against your business costs.
     
  3. volund

    volund Senior Member

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    Occupation:
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    Just having a website is not enough, you have to have a business. The IRS differentiates between a business and a hobby. Your goal has to be to make money and if audited you need to be able to show that is what you are trying to do. Are you running it like a business? Do you have a business plan? Even if you lost money the first couple of years, are you improving your situation to start turning a profit soon? Do you have separate bank accounts for the company money? If the IRS thinks you are gaming them these are all things that they will look at.

    Now you do not have to show a profit every year but if you show a lose every year due to cruise expenses dollars to donuts you will be audited. I think in this area it would be harder to convince them during an audit then say somebody with some inventory that choose the wrong product.

    As with any tax questions you should talk to a cpa and/or tax attorney before doing anything questionable.