This whole idea of business and #######s and taxes ad nauseam has been on my mind for a while. Especially since Terry Primos announced he is giving up knife making because he can?t overcome the overhead, most of which is tax related.
Before I get started, let me say that I am offering my opinion for consideration. I am not recommending a course of action for anyone. Just my rant.
I have tried to operate a business from my home and before I was granted a ####### I had to pay for each year, I had to go before the city zoning board and get a zoning variance because I live in a residential neighborhood. Then I had to apply to the state for a tax number so I could send them a portion of every dollar I made. Then, at the end of the year, I had to give the city a list of all my equipment and its purchase price and when it was purchased and a list of all my supplies and materials and their values so they could bill me for ad valorem (personal property) tax. Then, of course, if I made a sale of any kind, it had to be reported as ordinary income to the state and federal governments. It didn?t take long to figure out that I was working for the city, state, and federal guys and they didn?t think I needed any income at all. Needless to say, that business didn?t last long.
I?m probably just like a lot of other people who make knives. I really like to make knives and I figure I can sell some and over time pay for my habit. I doubt I will ever be well known in the world of knives but that is OK. I just want to make knives. I don?t want to have a knife business, I just want to make a few and maybe sell enough so I don?t have to rob the family to do it.
Ask yourself, if you decided to have a yard sale and sell off a bunch of stuff you have collected and made through the years, would you get #######s and tax numbers and all that crap or would you just have a yard sale and have a good time? I submit that most of us wouldn?t even report the money we made as income but according to the tax folks, it is income and should be reported for tax purposes.
Bottom line; if you are in the ?knife business? you should probably do the whole tax and ####### thing (people on welfare need the help). If you have a hobby of making knives, report the income on your taxes if you feel that you should (render unto Caesar?). Whatever you decide, have fun. If it aint fun, find something that is and pursue that.
Thanks for your time.
Carey