[HUG ] Re: SV: Re: On the subject of equipement cost plus questions on flash systems.

If you're operating a business and taking tax deductions, one test the IRS uses is whether you make a profit. You must make a profit in at least 1 in 6 years, otherwise the IRS classifies your enterprise as a hobby.
No matter how fast the equipment is obsoleted in the 'real world', as electronic or computer equipment it 
generally would have a 5 year life for depreciation purposes.


Joe McGuckin
ViaNet Communications

joe@xxxxxxx
650-207-0372 cell
650-213-1302 office
650-969-2124 fax



On Oct 15, 2008, at 10:28 PM, Sherman Bloom wrote:
First paragraph of this Todaroff message is exactly what two accountants have told me, and it is this approach which i use for my personal tax reports. One year I took no deductions because I did not sell, or try to sell, anything. Legally, I am told, it is the EFFORT (which confirms INTENT) to sell that makes your deductions legitimate. So I keep records of gallery exhibitions or other evidence of bringing my work to public attention. Publication of magazine articles and images is, I think, a good step in this direction. Submissions to contests (which I find unpleasant) are also good in this regard, especially if you win something and/or have your images published or displayed.
Of course it is important keep records in a way that documents these activities as well as your sales and expenses. 

*REGARDING HASSELBLADS.*
I use a 503CW with a CFV or film back (as well as a Nikon system) . I do a certain amount of desktop flower and macro photography and some other still-life things. I use available light, sometimes with balanced fluorescent lights added. I am reluctant to get involve with flash systems, but maybe that would be a good thing. If I did go with flash I would probably need a ring light capable of low- power operation and, perhaps, one or more (low-power) slave units. Any comments? There are some excellent systems available for the Nikon, but right now I'm thinking only of the Hassy.
I also have a 500 ELX, but have never learned to use it, and so far do not see the need. Am I missing something here? 

Sherman Bloom
shermanbloom@xxxxxxx
www.digitalrailroad.net/shermanbloom


On Oct 15, 2008, at 8:55 PM, Gary Todoroff wrote:
You are in business in the US if you engage in financial activity with the intent to make a profit. The same rules apply whether you are a multi-million dollar company or an individual who loses money most of the time. The IRS "guidelines" stipulate that you should show a profit for some years, but I don't know what is the exact number of years. Tax LAW, last I heard, did not specify that you had to always make a profit, although numerous years of losses could trigger an IRS audit. In any case, the tax laws were made for the big guys, but the little guys get to play by the same rules. There is absolutely nothing shady about taking whatever deductions you are entitled to by the rules, as long as you are not fraudulent in your declaration of income and expense. That is the difference between tax AVOIDANCE and tax EVASION.
What I really hate is the smug attitude of someone who has always collected a paycheck who says to the businessman, "Can't you just write it off?" That is money out of your pocket, no matter what the expense. A write-off is money spent, plain and simple. If you can justify it as a business expense, however, some or all of it can be deducted from the profit of your business on which taxes are paid. An expense as large as the stratospheric cost of a Hassleblad these days would probably need to be put on a deduction schedule, in which you can only show a portion of the overall expense over a few years. In these digital days, you may not be able to actually deduct all the equipment expense from your profit until long after the equipment is obsolete.
In any case, I'm neither a lawyer nor an accountant. All the money I give those gusy to keep up with the insane rules, however, is a business tax "write-off", and an absurd waste of money that I would much rather keep in my pocket!! If you are not filing an IRS Schedule C these days showing profit and loss for some kind of business, then just kiss your paycheck money goodbye as it takes wings toward the bottomless pit called Washington, D.C. 

Gary Todoroff
In the USA, You must be trying to run a business.... with verifiable "things" that you do to maintain a business.... Then and only then can you deduct your costs.... and yes, from your other income if it is a loss.
Buying a $75K Hasselblad or Leica S2 system, taking it off the taxes and 
then doing absolutely nothing to actually run a business  ( real
advertising, some jobs, maybe a few customer meetings) will get your 
deduction dumped if you get audited.
The trick it to run the business at a zero, or, better yet, $1 profit a year.... and then run it forever...... Then you can buy a $75 Blad system and they can not complain...... as long as you can show you used the 
equipment in earning the revenue.......
I think our Tax guys are more intolerant.........than the Canadians...... 


Frank Filippone
red735i@xxxxxxxxxxxxx
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