Posts Tagged ‘Arizona Taxes’

Should You Hire An Income Tax Preparer?

Income Tax Preparation ServiceIncome tax preparation by a professional is a must in today’s economy. An income tax preparation professional can often times save you money by identifying deductions you may not have been aware of.  If you need Turbo Tax help, we can do that also.
80% Of Taxpayers That Use A Tax Professional Save More Time and Money

Tax laws and forms change all the time. An income tax preparer is up to date on every possible deduction you are entitled to; thereby minimizing the amount of tax you’ll pay and maximizing your refund.  A tax advocate on your side is a must in today’s environment.

Has It Been A While?

Are you behind on preparing your income tax return for previous years? Norris can often times dramatically reduce the amount you owe the IRS, even if you’re delinquent on your taxes.

Call Norris right now for expert, friendly advice and service. 480-812-1523. We can save you money.  I am your Tax Advocate with the IRS.

What is a Hobby a Business?

The IRS defines a hobby as an activity you pursue without expecting to make a taxable profit, you do it because you like doing it.  Be aware, however, when your hobby produces income, you owe tax on it.  You can reduce your taxable hobby income by deducting your hobby expenses, but this tax break is very limited.

If  you can demonstrate that you are involved in an activity with the expectation of making money on it, the IRS will consider it a business.

When does the IRS consider an enterprise as a business? The IRS will look at a lot of things such as:

  • Did you earn money or is it in the startup phase?
  • Did you have a profit for three of the five years?
  • Did you carry on the activity in a businesslike manner. This includes, for example, having business bank account, keeping good books and records, promoting your business and holding down costs where possible?
  • How much time and effort did you devote to the enterprise?
  • Do you depend on income from the activity for your livelihood?
  • If your losses are due to circumstances beyond your control or are normal for a business in its startup phase.
  • Whether you change your methods of operation in an attempt to improve profitability.
  • The knowledge and background you (or your advisers) have in running such a business.
  • If you were successful in making a profit in similar activities in the past.
  • Whether the activity makes a profit in some years and, if so, how much.
  • Whether you can expect to make a future profit from the appreciation of the assets used in the activity.
  • The element of personal pleasure involved in the activity. That doesn’t mean you can’t enjoy your new business, but you better be getting more out of it than just a good time.

The IRS says all the facts are taken into account and no one factor alone is decisive.