Well, yesterday I finally shipped off my LLC forming paperwork to the State of Georgia to make my business an LLC ( and a big thanks to Ed for his help in me getting this done <img src="/ubbthreads/images/graemlins/wink.gif" alt="" /> ) .
And that got me to thinking...there are alot of experienced dog trainers/ business owners on this site, and ya'll would be a good source of comparing information here.

Sooooo......first question.
What are your common ( and uncommon ) tax deductions regarding your dog business?

Here are some general things, most not directly related to a kennel:

Rent or mortgage, based on the specific area of your home used exclusively as an office. Repairs, maintenance, utilities for the home etc. using the same percentage. Any vehicle expenses that you can justify as part of your work, including car payment, lease, repairs, gas, etc. Of course, anything directly related to the dogs, like food, vet bills, toys, training equip., etc. I'd guess travel expenses to and from training and competitions, if you can justify the competitions as marketing or as necessary for the business. Anything related to advertising, like your web site.

I'm sure I'm leaving out a lot of stuff - do you have a CPA? Get one if you don't.

Jeff QUOTE: I'm sure I'm leaving out a lot of stuff - do you have a CPA? Get one if you don't. END

Yes, and you didn't leave out anything! This is what I do (my "day job").

This is personal suggestion and ideas, not tax advice to any individual:

When you go to your accountant, have with you the square feet of your home and of any adjunct used specifically for the business (a shed; a fenced run; converted garage, etc.). In your home, an entire room has to be devoted to the business, and then that room is deductible. Base the % of the rent or mortgage interest, utilities, and so on, on the footage of that room as a % of total usable footage. (Sounds picky, but really it's simple.) Once you have that %, then power, heat, insurance, etc., are easily allocated. A separate phone line is deductible. Identifiable calls on the home line, too. Single-purpose structures outside the house are a biggie; your CPA will tell you about the amortization. Start a log in your vehicle identifying total mileage as well as mileage devoted to the business. Keep maintenance, insurance, and fuel receipts, so your preparer can figure out whether you will do better with the standard mileage or actual cost deductions.

Get an expandofile or a set of folders and keep receipts and notes for all expenses and then when you sort out what is and is not deductible (with your preparer), you'll have the raw material. The cost of setting up and your CPA consultations should also be recorded in this file. If you have meals/entertainment expenses, keep a log of what business was discussed.

Basically: Figure our what room(s) and what single-purpose structures are devoted 100% to the business and estimate their % of the total property, then keep everything else logged and receipted for the preparer to allocate. Once you have a few file folders set up and a notebook in your vehicle, it's an easy daily habit.

Obviously, that last post of mine related to home expenses. Of course you'll keep all expense records of a separate facility too, as well as the amortizable costs of equipping it, furnishing it, and so on.

When in doubt, save the recipts and label them clearly for the preparer to make the call.

You can write of any damage that the dog does that has to be repaired. Periodicals and related memberships should be deductible as well.

Howard

you can also get tax-exempt status for purchase of things like dog food, kennels, kennel bedding, supplies, maintenance equipment, etc. easy to do in the store and takes about 5 minutes the first time. you will need to tell them which category you fit in, for example Agriculture - Animal Husbandry. after that, you just tell the cashier you are tax-exempt and they will ask for either a tax payer id or your phone number (depending on how their tracking system is set up).

-krista

QUOTE: you can also get tax-exempt status for purchase of things like dog food, kennels, kennel bedding, supplies END

Good reminder that there are other taxes besides federal and state income taxes.

Most of the states have a sales tax. The codes vary from state to state, so only very generally can sales tax advice be useful unless it's talking about a specific state (and, in some places, a specific county).

In many states the broad outline is: If you are purchasing for resale, then you apply for a resale number. You then present it (or a certificate; your state will provide you with some kind of ID) to the vendor in order not to be charged the sales tax. The rationale is that you will be charging the tax yourself to your customer and then paying it to your state.

Also, some states have other sales tax exemption categories such as non-profits, churches, etc. One of the categories in your state may be certain ag businesses (as Krista mentioned).

So number one is: Does your state have a sales tax? Five do not. Number two: Does your business fall into an exempt catagory in your own state? Or number three: Are you purchasing material for resale, with you charging the sales tax and paying it to your state or county? If number one is yes, and either of number two or three is yes, then you will want to apply for a sales tax exemption.

It's a state/local question, and you'll want to get local advice, from your state government or your tax advisor.