I have a meeting with my CPA next week and am trying to get everything togehter. Never really done this before but was hoping I could get some advice from some of yall. THanks in advance.

So far I have:
- Gear etc (Tacklewarehouse, bass pro, cabelas)
- Lodging/hotel 2011.
- Fuel
- All tourney entry fees for 2011.
- Depreciation on tow vehicle and boat????
- Insurance?
- Also blew a lower unit in 2011 but it was covered by Insurance. I guess I could write off the premium? .

am I missing anthing. All help is very much appreciated.

I do most through my company. But I have to show it as gas, advertisment, travel, etc. Im not sure what all you can wihtout a company.

Get a hold of Mike Kernan, he is real good and knowledgable about that stuff.

Can you write that stuff off just being an individual? I thought you had to start a company or whatever to write off fishing expenses. How do you prove it isn't just a hobby? Can you write off expenses from a hobby? I'm a TAX IDIOT... LOL

Jody

You can def write stuff off as an individual.

you have to be able to differentiate a "hobby" from a "source of income"... if you can prove that you are fishing to provide for yourself/family, then it is deemed a "source of income"... this is what the auditor told me in person a few years ago when I was audited. She wouldnt allow any expenses, as I had a main job that provided the source of income. Luckily I missed other expenses that made up for those writeoffs. She told me not to do that or it would always raise a redflag.


Barrett, with the amount you won- I would say it was definately a "source of income".... writeoff every expense you incurred!!!

So your saying I can't write off anything because I have a job? wtf... the CPA explained it to me earlier this week much differently. Hes the one who helped me come up with a list.

for small fry like me who only win 1-2K... no writeoffs...

for big fry that win basschamps... writeoff everything... I should have read more of the posts.. duh!

As stated above "it must be deemed as a source of income" and not a hobby.

ok.... and how do you legally differintiate this? Start your own company?

i would think i would be able to write off at least entry fees??

Barrett,
I'm confused as well, I am working with my accountant and here are his exact words:
You should claim to be a professional fisherman to do what you asked about. In that case, all expenses relating to the fishing are deductible including travel, supplies, boat, etc.. You will also report any earnings you have on Schedule C (Self Employed).

Now if you have seen me fish the only funny part here is Pro. I will be fishing alot of Tournaments this year so figured I would try to take advantage of what I could.

Well im pumped my little 12 grand in income has now turned me into a pro fishermen. Should I change my handle on TFF now? All kidding asside I would really appreciate a little more information about this matter.

I suspect there are many Elite guys that have full time jobs and own businesses to offset their expenses. Can se assume its their sole income to support their family.

You can write off anything you want..just don't get audited.Some tax advisores will push the envelope and if there is a gray area they will advise you to take it. Others will tell you not to cross the line at all.The time and expense of an audit,not to mention penalties and interest, can add up quickly business or no business.

I think you can still write off stuff if it is a hobby but you can't write off more than the amount you of income you made off of the tournaments. SO if you had $12k in income, you can only write off $12k in expenses.

It seems that this entire subject is a gray area.

I have recepits to back up every thing I could possibly write off. So my question is... can I write off fishing related expenses as stated above? I have a real job as well where I get my taxes taken out every pay check.

I would recommend listening to a tax professional, not a bunch of fishermen.

Barrett Big Bass Mc, LLC. Has a nice ring to it!

Not sure if its on the same line guys, but up until last year, I rodeoed professionally. I also had a career. My book keeper had me keep every receipt I could. I wrote off entry fees, fuel, and any equine products. This included feed, vet bills, etc. It really made a differance at the end of the year. Now that i am fishing instead of rodeoing, I haven't asked her about this issue. Im sure that it cant be very differant.

also, you might be better off setting it up as a business since you are BBMC after all and will in all likely hood have to do this with your ever growing winnings in the future. This way you can show that you lost money and get the most out of the stuff you are writing off.

I think this is the answer. You can't show a loss from fishing to offset your other income. If you paid $750 in entry fees and got one check for $600 for finishing second in a tournament you certainly did not have any income from fishing.

In years that I received a 1099 I've filled out a Schedule C.

Buda getting his drunk on last year at the Grapevine Open

^^This^^

Id definately talk to a CPA. I would think that if you report your winnings as income and pay the taxes on it, there's probably some deductions out there but I wouldn't expect as much as a true Pro who's only job is to fish.

Personally and PLEASE don't anyone take offence, I would ONLY listen to my CPA on this one. He/she is trained to know this stuff. Advice on here about fishing related stuff is the best in the world, but legal advice, not so much. He said, she said is just poor advice. Go to the legal experts for legal advice. Go to fishing experts here for fishing advice. Remember, this is my opinion and it's worth exactly what you paid for it.

I wouldn't change your handle, but I am sure the Pro Staffer will be on later for some guidance!

I would think the winnings would be treated similar to casino winnings. Under that case you will be able to write off some expenses associated with it. I would. Absolutly not try and depreciate your boat or tow vehicle as this is not your profession and it can cause tax issues when you sell either one. Listen to what your cpa says as mentioned about this is fishing forum not cpa forum.

I didn't read all of this but if you make ANY income and you plan on doing it again next year, it can be considered self-employment and you can write stuff off. I wrote off my "home office" to offset my taxes. You will only be able to offset the income you made from fishing though. Did you get 1099 misc or what from your tournament income?

Yea sorry to bring this up on a fishing forum but my cpa hasnt exactly written off fishing expenses for anyone... its kinda a new experieicne to him as well. I was just hoping someone in the exact same position has done this before and could help me.

Yes JC Outdoors, Tuff man and bass champs

Well then you are self-employed if you got 1099 misc...you can offset the taxes on that income...and only that income.

It is like a part time or second job. Lot of people have more than one.

Always show a little income ( don`t try to write it all off ) and you will be fine. Pay a little taxes on your winnings and you will be ok.

If you are writing off more than you make, it is a hobby and a red flag.

IMHO, better to do your own taxes, or rely totally on the pro guy, who may be wrong. You can also call the IRS,.......they are friendly now

You don't want to treat it as self employment (earned income) then you bring in self employment tax to it. That would be both sides of ss tax on anything left. You can probably write off entry fees for your tourneys, gas to and from, lodging. For the events themselves and that it about it. Anything else is going to potentially cause problems. Now if you happen to be a guide as well then you get into a different deal. Just be careful. Don't know what your tax bracket is but it very well might not even be worth it to work very hard at this.

So the way I'm reading these post is that you can only write off expenses if you made money and only up to the amount you made?

Also, I know for real questions consult a CPA.


Jody

I just schedule another meeting with him. Ill let yall know how it goes.

Professional fisherman have these awesome things called contracts. That is one way they legitimize what they are claiming.

I don't think you "wrote off" your home office.You may have taken depreciation on the square footage of your office. If you did then you would have to recapture the depreciation when you sold the house and pay tax on it.At least thats the way I understand it.

You basically have to treat it as a business from the start. If you end the year ahead and decide "hey I can write off more if I file a Schedule C" then you will probably be denied. I have done it in the past and quit when I lost the ability to devote the time to it as I would any other for profit venture.

Have a look at this ruling. It pretty well lays out what the courts look at when determining if an activity is a hobby or for profit.

http://law.onecle.com/tax/2006/h2ill.sum.wpd02.html


And, no, it does not have to be a significant amount of income nor do you have to quit your regular job. You just have to pursue it as if you are trying to make a profit.

But, yeah, contact your tax guy. Look for Mike Whitten in Tennessee, He's a CPA that fishes and has written some articles on this.

If you don't want to go the business route with a Schedule C and the Self emplyment tax, etc. Then you can write off expenses for hobbies up to the amount to won. Several above have mentioned that. That's what most fishermen are going to qualify for.

No need to be sorry. You have received some really good advice to take to your CPA. What I was saying is, just don't take what you have received here as legal advice. I've learned that some of these people on here are pretty smart folks, but most here aren't lawyers and CPA's and when it comes to the IRS you don't want to use advice from friends as the final say. Believe me, I know of what I speak.

I'm not a CPA but I did stay at a Holiday Inn Express last night.

I would follow these type of instructions directly from the IRS website. This is for gambling but it seems to be closely associated with your situation.

Topic 419 - Gambling Income and Losses

The following rules apply to casual gamblers. Gambling winnings are fully taxable and must be reported on your tax return. You must file Form 1040 (PDF) and include all of your winnings. Gambling income includes, but is not limited to, winnings from lotteries, raffles, horse races, and casinos. It includes cash winnings and also the fair market value of prizes such as cars and trips. For additional information, refer to Publication 525, Taxable and Nontaxable Income.

A payer is required to issue you a Form W-2G (PDF) if you receive certain gambling winnings or if you have any gambling winnings subject to Federal income tax withholding. All gambling winnings must be reported on your Form 1040, including winnings that are not subject to withholding. In addition, you may be required to pay an estimated tax on your gambling winnings. For information on withholding on gambling winnings, refer to Publication 505, Tax Withholding and Estimated Tax.

You may deduct gambling losses only if you itemize deductions. However, the amount of losses you deduct may not be more than the amount of gambling income reported on your return. Claim your gambling losses on Form 1040, Schedule A, as a miscellaneous itemized deduction that is not subject to the 2% limit.

It is important to keep an accurate diary or similar record of your gambling winnings and losses. To deduct your losses, you must be able to provide receipts, tickets, statements or other records that show the amount of both your winnings and losses. Refer to Publication 529, Miscellaneous Deductions, for more information.

I'm a CPA, but I do not specialize in tax.

General rule: you can writeoff expenses incurred in pursuit of the income earned.

There are hurdles to overcome inorder to claim your tournament fishing is not a hobby, which will effect your deductions (such as depreciating your boat).

I would certainly go with professional advice from a CPA, and if you're CPA isn't sure, they should be able to contact other peers in the business to get it right.

Otherwise you may want to look at adding the road tax on gas as another write off. Keep track of every gallon used on your boat. For example - I use about 2000 gal of gas per year. Let's say the road tax contained in the price of gas is $.38. Well, 2000 X .38 = $760 refund...

I wrote off the wife and man I got to fish so much more.

This is correct unless you can convince the IRS that you tourney fishing is in pursuit of taxable income (if) you get audited.

Google--Schedule C instructions 2011. It will give you the rules for deducting business expenses. Hobby loss instructions are in Publication 17 (beginning with page 92) and it will tell you that you can deduct expenses up to your winnings if the activity is a hobby and not engaged in for a profit, if you can deduct expenses on a schedule A. You may have to prove a profit motive if you deduct expenses on a Schedule C and you get audited.

^^ This ^^ ... and I understand why you might bring this up here ... but, Dude, we're just dumb fishermen ... even the smart one's here.

Trust and rely on your CPA once you've met in person and laid out everything in front of him and fully discussed your situation. Don't even trust the advice of a CPA based on a mere conversation, phone call, or "Forum Posting". There are likely CPA's on here and probably some very qualified in tax issues. But they would also probably be the first to tell you to meet with someone personally to discuss your situation.

I wrote off stuff last year with the help of my CPA. Every 3 years you have to show a profit to continue doing it.

I've used a CPA for several years... Go get yourself an assumed name for your business of Bass Fishing at your city hall.

Then virtually anything can become a tax write-off. It can be time consuming to keep records, but it can be rewarding as well.

There is even another form that you can fill out and get .18 per gallon back from the state for every gallon of gas that you put into anything other than your automobile, e.g., Boat, lawnmowers, etc...It is the road use tax levied on gasoline.

You cannot deduct Fuel on the 1040 forms that you put into your truck unless you are writing-off the truck. If not, then you can deduct .51 per mile for Jan-June and .555 July-Dec. Plus a whole lot more!!!!!!

Get a sponsor and go into the advertising business.

I keep track of & write off:
Boat Fuel
Entry Fees
Fishing Licenses
All tackle & gear purchases
Lodging
Tow Vehicle Mileage for fishing
Website fees
Large items, like Trolling motors, boat, electonics, etc get depreciated

There is no label on that bottle....that usually means it was used as someones emergency potty bottle.

my cpa told me i could write all things above mentioned but eventually i would have to show some winnings or they would audit me ands it wouldnt be good for me

What gets me is you have to show a profit like 1 out of 3 years or they can get you on back taxes. I just don't get it. You can tourney fish for 25 years and loose your but, but one year you make some money and they want their cut.

I also was told to show a profit every 5 years not 3. I have seen people show losses for years and never get audited.

It's all legal till you get caught , after five years of no profit it's considered a hobby .

You mean you have to make money doing this???

Taxes suck. Stop paying them and tell the government to start making their own money by tapping into the giant oil field in eastern montana and North Dakota to releive us from foreign oil dependency. Then tell them to stop making pennies since it costs more to make them than they are worth. Then tell them to drug test every person that wants to be helped by welfare. Then run off to Mexico and hide out cause they are coming for you!!!