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Author Topic: 1099 and ABC taxes  (Read 5717 times)

shipper50

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1099 and ABC taxes
« on: January 30, 2006, 07:14:57 AM »
Am I the only one who has gotten his 1099 in the mail? I have never gotten money back from a tournament before in the past. I got $762.13. I don't remember getting the change back.

Any help from past money winners would be appreciated....
Shipper

 

CPA

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Re: 1099 and ABC taxes
« Reply #16 on: February 15, 2006, 09:21:11 PM »
You can use Schedule C to reduce the tax.  Report the total winnings as the revenue on Schedule C.  Then the expenses on the Schedule C are the bracket entry fees, tournament entry fees, travel costs to the tournaments, lodging for the tournaments, etc.  Any expense you incur related to generating the income is deductible.

shipper50

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Re: 1099 and ABC taxes
« Reply #17 on: February 16, 2006, 07:51:25 AM »
Anyone remember what the entry fees were for Baton Rouge? I forgot as I rode a bus for 16 hours to get there.. NEVER AGAIN.

Shipper

CPA

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Re: 1099 and ABC taxes
« Reply #18 on: February 16, 2006, 11:26:07 AM »
Your "business" is bowling.

Kathy McMillan

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Re: 1099 and ABC taxes
« Reply #19 on: February 16, 2006, 01:40:27 PM »
Put amateur bowler as your profession.

CPA

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Re: 1099 and ABC taxes
« Reply #20 on: February 20, 2006, 09:43:49 PM »
You should claim half of the expenses on your tax return.  Give a copy of the receipt to the person who shared the expenses with you.  They can claim the other half of the expenses as a deduction on their tax return.

CPA

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Re: 1099 and ABC taxes
« Reply #21 on: February 26, 2006, 06:50:09 PM »
It is possible to show a loss for more than three years and not be considered a hobby, however it is difficult.  The rule is an activity is presumed not to be a hobby if the activity results in a profit in any three of five years.  In other words, the activity is automatically not a hobby if there is a profit in three of five years.  If there is not a profit in three of five years, you must prove, if challenged by the IRS, that you had a profit motive, ran the activity like a business, etc.  The fact that you do not have a profit in three of five years does not automatically make it a hobby.

ClutchClay

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Re: 1099 and ABC taxes
« Reply #22 on: March 10, 2006, 12:41:22 PM »
quote:
Which version of the 1099 does this come on?


1099-MISC

According to a phone call to the IRS Tax Support Line, it is NOT gambling winnings and is therefore not subject to the winnings/losses rule.  Which means that you must claim the whole amount as misc income.

According to a CPA friend of mine, if you want to apply any deductions to the income, then you must file a Schedule C and call yourself a professional or tournament bowler.  I then asked about the rule concerning showing a profit in 3 out of 5 years (I think that was the rule).  His response was that rule is not enforced so long as you keep your records in a business-like fashion (i.e.: a financial ledger) to show that you are treating the Schedule C related transactions as a business.
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Regards, ClutchClay
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