Business license or no business license....

[nate_appel1]

Hi, recently I have been contracted to produce work (series of photographs for various

locations) for a nonprofit organization in California.

This is my first paying photo gig, but will require me to purchase some equipment I do not

have. The contract I have signed has a $10,000 cap for the year and my estimated expenses

will be $3-4000 which I want to deduct. My question is 'am I required to hold a business

license to deduct?'.... Any thoughts or suggestions to this newbie will be greatly appreciated.

Thanks.

[peter_daalder]

I can't provide you with specific answers for your location. However, it is most likely that you will indeed need to get yourself a business licence, in order to be eligible to <i>deduct</i> some of your expenses. It is even possible that you will <i>not</i> be able to deduct the full amount of your purchased equipment. In most cases, it needs to be depreciated over a set period of time. <br>You might find some of your answers <a href="http://www.sba.gov/starting_business/startup/guide.html">on this site.</a><br> Best of luck!

[art_haykin]

Having a business license or not is moot as far as the IRS is concerned, as they go after hookers and gamblers for taxes.A business license is normally a city matter, or county, in some cases. Your biggest problem could well be the State of California and the sales tax people (The Board of Equalization). I know, I was a pro there for nearly 40 years and that's ONE agency you don't to mess with, trust me! Your best bet would be to consult with a sharp CPA or tax attorney, as any advice you may get here is essentially worthless, except MINE, IRREGARDLESS 2 menshun.

[gary evans]

As Art said, you most certainly do not need a license to deduct the expenses. But you will need to file a Schedule C attachment to your 1040 next year.

 

Also, you can absolutely deduct all of your equipment in the first year. You DO NOT have to depreciate the equipment (incidentally, if you wanted to depreciate it over time, so you get deductions every year, I believe the depreciation period for virtually all photographic equipment is 5 years, even items that we all know will be obsolete in 2 or 3 years).

 

As for the Sales Tax issue, can't help you there. My for hire work has been too sporadic to really worry about it. Yes, I know technically I need to collect and pay sales tax, but for the amount of my income from photography at this point, I'm willing to roll the dice.

[scottl]

Get paid in cash and keep it in a coffee can buried in the back yard.

[reenie_raschke1]

To "run a business" you can have a sellers permit, a business license and a TAX ID#.

Unless you are paying employess, you need not have any. If you want to charge tax or

write off any purchases toward income, it's a good idea to get a TAX ID # aka EIN#

 

Call 1800 829 4933 and they will tell you EVERYTHING YOU NEED TO KNOW.

 

It's not as tricky as it seems. Good luck,

 

Reenie

[J.W. Wall]

Prudent business answer: see a qualified CPA or business attorney as soon as possible. Whatever you pay them is likely to be a lot less than what you lose if you guess wrong based on unqualified advice. JMO.

[aaron l]

I got a tax resale license (CA), it doesn't cost anything and it takes 10 minutes to fill out. Drop it off and your license shows up in a week. They can do it in a 1/2 hour if you have the time. Of any of them to mess up, don't miss charging sales tax. They'll make you cry.

You don't need a business license to deduct, IRS doesn't care, but every city you do business in requires it. I'm busy with registering all my images first, then the business license.