Tax Time to Report Finds as Income

[Tom_in_CA]

I'm self-employed as a metal detectorist. I pay myself a reasonable $10.00 an hour, but I rarely find more than $3.00 an hour. Therefore, my business has incurred a net loss, so no need to file an income tax return...

Really ? I don't think so. Business that file a "loss" still have to file. Sure you'll "owe no taxes" (if your write-offs exceed you incomes). But filing is still necessary. Just ask an IRS lawyer (you can't be too safe afterall).

So hurry ..... do the right thing. Make us all proud

 

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[hvacker]

Really ? I don't think so. Business that file a "loss" still have to file. Sure you'll "owe no taxes" (if your write-offs exceed you incomes). But filing is still necessary. Just ask an IRS lawyer (you can't be too safe afterall).

So hurry ..... do the right thing. Make us all proud

Yup..

 

[Deft Tones]

Just start a new unprofitable business every five years. That's what it seems many of the bars around here do they change names so often.

 

[boogeyman]

I'm self-employed as a metal detectorist. I pay myself a reasonable $10.00 an hour, but I rarely find more than $3.00 an hour. Therefore, my business has incurred a net loss, so no need to file an income tax return...

Oh oh! Here come the protestors followed by the Feds!! They're gonna protest and have you arrested and take away all your pulltabs because you're paying yourself $3.00 instead of the $10 minimum, shame on you not paying yourself minimum wage!

 

[Deft Tones]

Oh oh! Here come the protestors followed by the Feds!! They're gonna protest and have you arrested and take away all your pulltabs because you're paying yourself $3.00 instead of the $10 minimum, shame on you not paying yourself minimum wage!

He's his own intern. lucky he gets paid at all!

 

[boogeyman]

He's his own intern. lucky he gets paid at all!

Good one!!
Let's just hope his job doesn't get outsourced to India!!!!

 

[clv]

I know nothing, I saw nothing, I found nothing!

 

[FreeBirdTim]

Really ? I don't think so. Business that file a "loss" still have to file. Sure you'll "owe no taxes" (if your write-offs exceed you incomes). But filing is still necessary. Just ask an IRS lawyer (you can't be too safe afterall). So hurry ..... do the right thing. Make us all proud

I was kidding, of course. But remember that everyone in this country is innocent until proven guilty. Even the IRS has to prove guilt. Without a paper trail, the IRS has jack squat. I believe everyone should pay their fair share, but some taxes are just ridiculous.

Here's a perfect example. If I find a cache of silver coins worth $500,000, the IRS would expect me to declare that as income, even if I never plan on selling it. The inherent flaw here is that I would have to sell some of the coins to cover the taxes! Not right and it shouldn't be legal. It's not income if you don't sell it. If I sell it in 20 years, then it would be income and that's when I should have to pay taxes on it. Just my take on it...

 

[Tom_in_CA]

..... Without a paper trail, the IRS has jack squat....

Ahhh, but we have your T' net "today's finds" show & tell posts as the "papertrail". Plus I have video of you in the park digging those clad quarters and dimes. Tsk tsk.

....to declare that as income, even if I never plan on selling it. .....

Ok, if you never cash in that clad, and never sell your key date stuff on ebay (we're watching your ebay account), then you're fine. Yes, not till sold or used ("realized") does it qualify as income I think .

 

[FreeBirdTim]

Tom sounds like he's been drinking the IRS Kool-Aid. Everyone must pay their fair share. Big brother is watching you. Not reporting your $100 in clad finds is punishable by death. Obey, obey, obey...

 

[FreeBirdTim]

Ok, if you never cash in that clad, and never sell your key date stuff on ebay (we're watching your ebay account), then you're fine. Yes, not till sold or used ("realized") does it qualify as income I think

Sorry, that's not how the IRS works. You have to declare it in the year that you found it, even if you don't want to sell the coins. One of the more vile things the IRS pulls on the good people in this country...

Found Money is Awesome?.But You Must Pay Uncle Sam | Fox Business

 

[Old Bookaroo]

There are two events that cause group relationships to explode (or implode): Failure and Success.

Far too many ventures fail to plan for success.

An interesting article:

Forbes Welcome

Good luck to all,

The Old Bookaroo

 

[Deft Tones]

When I clean and tumble clad to get it into circulation...think I can deduct that expense?

 

[lastleg]

There is also depreciation on tumblers to consider. So you set up a five year depreciation schedule
on your tumbler so you're not hit with an audit. What happened with the Paperwork Reduction Act?

 

[boogeyman]

When I clean and tumble clad to get it into circulation...think I can deduct that expense?

Good question! I've had one experience that might apply. Got audited one year. The big red flag was I had my tax preparer try to depreciate my metal detectors and equipment. My preparer & I spent almost two weeks getting my ducks in a row. We walked in and were sitting in front of the IRS guy. This guy had a "Holier than thow attitude as big as Texas" after he flips through the papers he had, he shoves a paper across the desk and tells me to sign it. I asked him if I signed "this document" would I be giving up ANY of my constitutional rights. His reply? "Just sign this so we can move along". Asked him two more times. This guy was P1$$ed!!! Gets up from his desk slams his file shut and storms out of the office! We're sitting there wondering if he went to get officers to arrest us or what. After 20 or 25 minutes he comes down the hall laughing with another employee and as soon as he sees us still sitting there he's shocked! All he manages to say is "You're still here? You can leave." All the work we did and that was all it took? Over the years I've told several people about this incident, and they've used it, more successively than not.

Ok, Here comes Tom spouting off with the anti govt. stuff!

 

[Deft Tones]

Tom sounds like he's been drinking the IRS Kool-Aid. Everyone must pay their fair share. Big brother is watching you. Not reporting your $100 in clad finds is punishable by death. Obey, obey, obey...

I hope you escape N. Korea one day.

 

[Tom_in_CA]

Sorry, that's not how the IRS works. You have to declare it in the year that you found it, even if you don't want to sell the coins. One of the more vile things the IRS pulls on the good people in this country...

Found Money is Awesome?.But You Must Pay Uncle Sam | Fox Business

Great link Free-bird. Was fun reading. Lots of legal precedents there. Yup, sounds like the IRS Here's the sum up quote: "... The lesson to be learned here is that almost every dime that comes into your possession is likely to be taxable income...."



I guess it would be no different than your employer paying you your paycheck: Your payroll taxes are witheld right then, whether or not you spent the $$ right then. So as for the clad, you appear to be right: Taxable even though it sits in jars at our houses. Shame on us

But how about when you find a 1916 D merc. dime that's worth $1000.00 ? I'm betting that you're not liable for the tax on that UNTIL you sell it. Otherwise, in the meantime, it's worth .10 c ?

 

[agflit]

Someone correct me if I'm wrong...but deducting expenses in regards to detecting is not allowable as a hobby... which is EXACTLY why I have a LLC business and run it as one...

ag

 

[Tom_in_CA]

.... Ok, Here comes Tom spouting off with the anti govt. stuff!

No no, I'm pro-government. You should've signed the papers they gave you. And should be paying our taxes on your finds. And you shouldn't take vending machine coin-return proceeds. And you shouldn't detect anywhere that doesn't have a glaring "md'ing allowed here" signage.

 

[Tom_in_CA]

Someone correct me if I'm wrong...but deducting expenses in regards to detecting is not allowable as a hobby... which is EXACTLY why I have a LLC business and run it as one...

ag

ag-flit, your post sent me on a hunting excursion. Here's some info:

https://www.irs.com/articles/tax-tips-people-who-earn-income-hobby

But if I'm understanding this correctly, this isn't saying that incidental hobby incomes ISN'T taxable, but rather: The point at which you BEGIN TO TREAT IT as a business (such that you can deduct expenses).

Some key quotes in that link:

" .... If you have a hobby that is also a source of income, you’re required to report the income on your Federal tax return....."

&

Hobby vs. Business

For tax purposes, a hobby is defined as an activity that you engage in “for sport or recreation, not to make a profit.” Even if you earn occasional income from doing such an activity, the primary purpose must be something other than making a profit.

&

".... According to the IRS, an activity is deemed as a business if it makes a profit during at least 3 of the last 5 tax years, including the current year ....."

Regarding what's highlighted in red above: We all "earn occasional income". Yet our "Primary purpose" is not to make a profit.