class racing as a business?

Dan Fahey · 07-16-2013, 11:34 AM

Hey Scott:

It would be a lot easier if you already had a profitable business.
I had a racing business in the 80's and won a good bit of money but more losses which reduced my taxes, a lot !
But the laws killed off a lot of public deductions such as interest on all loans.

Today my company DanSources sponsors my car and use the advertising deduction as key tool.
Since I also Referee Soccer those earnings are reported too.

The IRS does look for people abusing the system.
When caught you can see them whine and cry about it.

The IRS will allow you to deduct against what you won and avoid paying taxes on the earnings.
If you are out for blood they will visit you.

Got audited 3 times 1983, 1984, and 1990, twice in 2002 and 2004.
The last two were very thorough but each were done in a day.
2002 ended up getting a small refund.

If you do it with the intent to stay honest, keep good records there will be few problems even during an audit.

Be Square Play Fair.

Dan

07-16-2013, 11:34 AM	#8
Dan Fahey VIP Member Join Date: Oct 2008 Posts: 2,128 Likes: 1,084 Liked 184 Times in 113 Posts	Re: class racing as a business? Hey Scott: It would be a lot easier if you already had a profitable business. I had a racing business in the 80's and won a good bit of money but more losses which reduced my taxes, a lot ! But the laws killed off a lot of public deductions such as interest on all loans. Today my company DanSources sponsors my car and use the advertising deduction as key tool. Since I also Referee Soccer those earnings are reported too. The IRS does look for people abusing the system. When caught you can see them whine and cry about it. The IRS will allow you to deduct against what you won and avoid paying taxes on the earnings. If you are out for blood they will visit you. Got audited 3 times 1983, 1984, and 1990, twice in 2002 and 2004. The last two were very thorough but each were done in a day. 2002 ended up getting a small refund. If you do it with the intent to stay honest, keep good records there will be few problems even during an audit. Be Square Play Fair. Dan Last edited by Dan Fahey; 07-16-2013 at 11:38 AM.