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Richard J Kinch Richard J Kinch is offline
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Default tax question: switching over from hobby to business?

Grant Erwin writes:

I want to know the mechanics of transferring assets to my business and
then depreciating or writing them off.


Don't listen to all the scairdy-cat advice. The wheel would never have
been invented with the typical mindset about taxes and liability these
days.

If your intent is to report the honest numbers, then file the Schedule C
and 4562 for depreciation with your best honest numbers. The risk of ever
having to prove your reporting is very low.

The "hire an accountant" advice is silly, because the true cost is actually
30 times what it might appear, reflecting the chances of such backup
actually mattering in the real world.

The difference in outcomes from doing it yourself versus hiring a
"professional" is minimal, and not worth the expense. It's neurotic to
prepare the perfect income tax return, because there is no such thing to
begin with, and your amateur approximation is good enough considering the
unlikelihood of anyone ever reading your return beyond checking arithmetic.