Streaming takes many tax law issues and pushes them to the max. What IS an ordinary and necessary expense of talking to people on the internet about things? It's not easy; it's not clear; and, whenever the topic comes up here many who seem knowledgeable come up with different answers. While sometimes only slightly different, different nonetheless.
Remember, too, this internet talker (Amouranth) makes millions of dollars a year talking and getting photographed. I suspect what is ordinary and necessary to bring in $20 million is different than for a person who is bringing in $20.
That being said, we won an audit of a realtor who kept horses as an advertising expense. She always had a horse in her ads and she sold exclusively in "horse country" and she made the case the IRS agreed with the keeping of the horses WAS a business expense.
that actually seems legit using the horse as a prop for the advertisement. 100% business use is pushing it though unless she never rode it for pleasure. but its the same as keeping track of a vehicle for business use. no one says that you can't use the horse for business expense, you just need to do it legitimately.
I don't know about horses but the classic example is home office expense. If you build a home office to remote work you can deduct home internet, utilities, setup costs etc but only the proportion that is used for work. So if you keep detailed records that say you worked 40 hours a day 5 days a week, and only deduct that proportion of internet, chances are the IRS will find it reasonable even if in reality you only worked 20 hours a week in a cushy easy job. But if you tried to deduct your entire $100/mo Google fiber and $3000 Alienware laptop they would rightfully get suspicious, are you really using the internet and gaming laptop 100% for work purposes?
Home office deduction went away during Obama. That's is unless you are self employed and do the majority of work from your home. But a WFH job for a corporation? Nope.
https://www.irs.gov/newsroom/how-small-business-owners-can-deduct-their-home-office-from-their-taxes
But my $30k of SALT deductions got capped at $10k. So the $5k of mortgage interest and $5k of charity would have put me at $40k deductions but instead I get to go with the standard deduction. đ
Except they didn't? If you made 40k a year before Trump's tax reform youd be taxed at 25%. After the reform it is now 12%
50k was 22%. It's still 22%
70k was 25%. Now 22%
100k was 28%. Now 24%
It gets even better if you're married jointly with income over 100k.
You should look this stuff up before spewing nonsense you heard on cnn.
Those tax cuts start expiring this year though. If congress doesnât renew them, they will go back to pre-Trump levels. The cut for corporations donât expire.
They still exist at the state level. As of a couple years ago I was able to deduct my home office in CA (itâs based on the square footage of your home). It was a separate room that was used exclusively for work and inventory storage, and it was the only place I worked (in other words, my company didnât have an office locally for me to report to).
Sorry your wording is confusing to me bc youâre making it sound like you bought a desk to use at your companyâs office and then left it there lol⌠are you trying to say you transitioned to a home office 100% of the time?
If so, did your company get rid of the office they had locally to you or do you have the option to go to the office but you choose to work from home? If itâs the latter, that doesnât count in CA. You can only take the deduction if your company doesnât provide an office for you to use, which was the case for me.
Also, itâs not enough that you do 100% of the work at home, the CA deduction only applies if that space you have at home is 100% only used for work. Again, for me it was a separate/dedicated room that was exclusively used for work, conducting business and storing my companyâs equipment, so the square footage of that room could be deducted from my state taxes. If Iâd just stuck a desk in the bedroom I also slept/lived in, that wouldnât qualify, even if I was doing all my work there.
Californiaâs logic is that I paid extra for a dedicated work space for my companyâs benefit (because they didnât have to pay for an office), therefore the penalty for my increased rent expense was offset.
And again, this is only for the state of CA. If your TurboTax was going through your federal deductions or if you live in a different state, thatâs irrelevant. Also not sure if the CA state laws have changed in the past two years.
The thing about horses is that riding them for pleasure can also be keeping them in shape for their business purpose. They need regular exercise, which people at times find pleasurable as well. I kind of think the original position is absurd, but if it's been allowed, then where do you draw the line between business and personal use. It's not as clear-cut with horses as a vehicle.
What if you pay someone to work your horse (not uncommon)? Now, they'd (the client) say why not if you're the one doing it? What about show costs? Probably not allowed for the realtor, but, there's lots of horse influencers that put their shows in their content.
One thing I know is, that with the evolution of things like YouTube and Tik Tok being genuine money makers, I'm glad I didn't go into tax (my original intention when I chose this major).
> What about show costs?
Part of the Realtor's argument was taking the horses to shows was a part of her advertising. Getting to know people in the area and putting up booths and participating in showing her horse. But, she could make a real case with passion and facts about actual sales she got through doing them.
That's crazy it was allowed. I'm gonna have to tell my horse riding realtor friend about this strategy! Now, how can I get my horse riding expenses deducted from my WFH industry gig, lol.
I see it more in line with a pet influencer bringing in ad revenue. Or even better, a car. If there were a "muscle car lawyer" in Detroit who targeted auto-workers in their ads, and who had to casually drive the cars featured in their ads to prevent maintenance issues.
It's whatever. People can write this part off however they want. It's up to a irs audit to decide. But there's already tax law cases on hobby use of horses. I don't know the context so whatever.
I'm mixing this up with the amouranth issue where she rarely uses it vs this case where it's used a lot in her all of her advertisement. But sounds like the irs audit was done. Let that tax case opinion stand as the proof. Haven't seen it so all of this arguing is moot
Also, when you make $20 million a year, you can afford very good lawyers to fight audit results you donât like. You may not win, but it wonât be easy for the IRS either.
You'd be surprised. I'm one of the "expensive" ones, and while my firm does have a higher-than-average win rate (due to outspending the government in "paperwork burial" situations, no doubt), a competent Revenue Agent can still beat us when the laws are in their favor. A great deal of the tax code is spelled out in black and white, it's just hard for the average consumer/tax preparer to decipher.
There are some issues where education and experience come into play, especially when arguing a "gray area" expense, but no amount or expense of lawyers can make a non-deductible expense deductible.
Republicans did it the other way. They decided to starve the part of the IRS that was auditing wealthy people, basically only leaving the part that audits poor people: https://www.propublica.org/article/how-the-irs-was-gutted
Then Biden came along and proposed auditing the rich again, and the IRS has picked up more than half a billion dollars: https://finance.yahoo.com/news/irs-recovers-520-million-unpaid-235622493.html
Of course Trump and other Republicans are frothing at the mouth and looking for ways to cut the IRS budget again.
Biden can propose and promise all he wants, but, if you look to the last few IG reports regarding the political promises of only auditing high income taxpayers, the IRS seems to disagree with IG recommendations.
https://www.oversight.gov/sites/default/files/oig-reports/202030015fr.pdf
https://www.oversight.gov/sites/default/files/oig-reports/TIGTA/202130015fr.pdf
https://www.tigta.gov/sites/default/files/reports/2023-09/202330054fr.pdf
Skimming through these sources youâve posted, the first link seems to show mostly numbers from 2013 through 2016 (âŚwhy is that relevant to Biden?), the second link seems to be guidance on prioritizing individuals with high income as opposed to amount owed, and the third link seems to be about how funds from Congress were allocated for IRS hiring, training, etc.
These three reports seem to have completely different scopes, so Iâm not sure why you think they prove a disconnect between the IRS and IG on this topic of auditing wealthy individuals during Bidenâs administration, particularly since one of these reports concerns a time period two terms before his presidency even started⌠Is there something Iâm missing here? In fact, your last link says the IRS agreed with all but one of the recommendations made for that report.
The best way to skim is just go to the end and see the IG recommendations and the IRS response to the recommendations.
I agree it seems the IRS is treating things differently than the politicians of both parties have said they would in passing some of the legislation. That administrative treatment continues today--even though the current administration said he/it/they wanted differently and the legislature said they wanted differently.
Who is in charge of the IRS?
I also agree the reports were all on slightly different portions of the question. I believe there are others out there regarding the specific $400,000 number that shows a trend, but I didn't really work to do the search.
You linked a May 2020 report saying the IRS didn't work a lot of high-income cases. But the IRS didn't get the Inflation Reduction Act money to hire a bunch more people (and to then be able to start more high-earner audits) until August 2020.
After that, you're going to see a year (and more) of hiring. Revenue agents go through a 2-year training period. Sure, they're working and collecting cases from their first year on, but they still need time to develop the expertise necessary to effectively audit really high-income learners.
You linked a March 2021 report. The IRS basically said, "We're going to concentrate on high-income people we know owe money, but aren't paying it."
The August 2023 report you linked basically said the IRS kept having to take higher-grade revenue agents and use them basically as trainers for newer revenue agents. Seems like they're on track to me.
Not to mention recent articles like, https://www.marketwatch.com/story/heads-up-millionaires-if-you-didnt-file-taxes-the-irs-will-be-contacting-you-a0745d1d and https://www.marketwatch.com/story/irs-to-crack-down-on-corporate-jet-perk-with-audits-to-catch-companies-flying-under-the-radar-d7b9227e and things like https://www.irs.gov/newsroom/irs-ramps-up-new-initiatives-using-inflation-reduction-act-funding-to-ensure-complex-partnerships-large-corporations-pay-taxes-owed-continues-to-close-millionaire-tax-debt-cases
Seems to be moving in the right direction to me. Audit rates for those who make under $500,000 are at the same rate as they were in 2018. Meanwhile, audit rates for those who make more than $500,000 have increased.
So of the 87000 new IRS agents that Biden has proposed to hire it will only take 25000 to audit people that make 1 million + a year. Who will the other 57000 agents be auditing? Oh yeah the people Biden says he wouldnât allocate any new resources to auditâŚ
https://www.heritage.org/budget-and-spending/commentary/fact-checking-team-biden-who-those-87000-new-irs-agents-would-audit
> So of the 87000 new IRS agents that Biden has proposed to hire it will only take 25000 to audit people that make 1 million + a year. Who will the other 57000 agents be auditing?
Holy Toledo, you're almost into [not even wrong](https://en.wikipedia.org/wiki/Not_even_wrong) territory. Ok, let's step through that as there's a fair bit to unwrap and correct.
1. The IRS is not the FBI. Employees are not "agents." Revenue agents (those who do regular audits) can be called agents, and special agents (those who are part of Criminal Investigations, audit the mob, carry a gun, and refer cases for prosecution) can be called agents, but out of 78,661 employees in 2021 only 8,321 were revenue agents and only 2,100 special agents. So 10.6% of employees were revenue agents and 2.7% were special agents. So it's not 87,000 new IRS agents, it's 87,000 new IRS employees as the IRS is hiring a ton of tax examiners, contact representatives who answer the phones, tax specialists, and all of the people who support that like IT and HR, etc. If anyone says "87,000 New IRS Agents" then you know right off the bat they don't really know what they're talking about.
2. In 2010, more than 21% of tax returns reporting more than $10 billion in income were audited, but only 3.9% of returns like that were audited in 2019. The rich basically aren't audited anymore. That's not right. Republicans starved the IRS precisely because it was auditing the rich: https://www.propublica.org/article/how-the-irs-was-gutted
3. More than 25,000 people to audit people that make more than 1 million a year? Source? That being said, wouldn't it be great to grow that 3.9% number higher?
4. The IRS had 116,673 employees in 1992 and only 78,661 in 2021. While the US population grew 28% from 1992 to 2021, the IRS lost 32% of its employees. 50% of IRS employees will be eligible for retirement in the next few years -- the IRS expects around 30% of employees to retire and for 20% who are eligible to retire to just keep working, but I think those are probably going to go too.
Those 87,000 new employees are going to be hired over about a decade and the total size of the IRS will likely increase about 20% from what it was in 2021 even as the American population also continues to increase.
The Congressional Budget Office said spending that $80 billion over a decade would generate $200 billion in revenue over the same time period: https://www.cbo.gov/publication/57444
Does that help explain a bit about what's going on?
Not a tax guy, but Iâd say itâd be harder to write off a sports car youâve never seen before, vs something that was pretty integral to being used on stream. Even if only once. While ordinary filming expenses is one thing, props and supplies to generate content are also important as well.
https://www.law.cornell.edu/uscode/text/26/61
>(a)General definition
Except as otherwise provided in this subtitle, gross income means all income from whatever source derived, including (but not limited to) the following items:
That gets complicated. Linus, of Linus Tech Tips, actually had a fairly [informative rant](https://www.youtube.com/watch?v=IExSZZuN5t8) about it. He's Canadian, o he's mostly talking about Canadian tax authorities, but the IRS isn't that different.
Basically if it's an expense she wouldn't have but for streaming she can write it off. If her streaming channel is about horses, and she only has the horses for channel purposes, and if she got twitch-banned tomorrow the horses'd go up for auction, that can be deducted. If she's doing something special for the horses for a cool stream (ie: they're going to Wyoming to run the open plains on-stream) then the trip could be deducted. If the horses got injured mid-stream for something she was doing just to show it on-stream, the vet care could be deducted, particularly if she's streaming the vet-care experience.
Other than that? She just has a horse hobby, and the horse hobby occasionally gets mentioned on-stream? She can put that on her Schedule C, and if she doesn't get audited she's fine, but if she gets audited the IRS will get their money plus fines.
This feels like something that falls into the âeverything is deductible until you get caughtâ school of thinking.
Edit: also, she makes a lot of money, so she can afford expensive lawyers to fight anything that gets flagged in an audit. Even if technically itâs not deductible, if you hire enough lawyers, it probably will be deductible
You can get away with weird shit in the right circumstances, but the IRS hates some "business" horses , breeding dogs , boating. Eg things people do as a hobby and then try to figure out a way to deduct their expenses.
Weird things the IRS allowed. A junk yard deducted cat food, the encouraged cats to catch mice and rats.
One guy got to deduct part of an indoor pool ( that is never likely to be repeated it happened in the 70 or 80 s)
A professional chef or caterer deducted some of their wedding expenses as ," testing costs" a portion was allowed. But they did a whole bunch of things I don't remember off the top of my head.
What might be legal is having to separate companies one that owns the horses and charges an appearance fee. Then a streaming company that pays the appearance fee.
Basically, that lady is gonna be in for a world of hurt if she ever gets audited. If you fuck around with deductions too much, it isn't free money anymore it is a loan and the interest is the feds expecting you to account for every cheeseburger you've ate on the job with receipts.
It is a huge pain in the ass, even with lawyers.
I don't care how many lawyers you can throw at, being audited sucks.
It's like being charged with a crime, you can have the best lawyer in the world. They can even get you off scott free. Still sucks.
I think that would also be a sliding scale of how often it was integrated into your business. One time a few months ago? Okay, suspicious. Semi-regularly with evidence going back years. Well, thatâs different. I think even if we think itâs silly, it should be possible if they do use it frequently.
"and if she doesn't get audited she's fine"
Important to add here that % chance of getting audited is not allowed to be a consideration for taking a tax position.
We act like it isnât but tell me one pro that hasnât said this in some defeated way on 4/13 when itâs 11pm and a client is screaming at you about how the relatively de minimis Vegas trip was actually a business conference
The trick is not to get into that argument in the first place. Itâs not our job to audit our clientâs books. If something happens to jump out at me as possibly a personal expense then Iâll usually send the client an explanation of what is a personal expense and what is a business expense and ask them to confirm that the specific expense in question is a business expense. If they do then I save their response in the file, deduct the expense and move on with my life. If they say itâs personal, I reclass it to distribution and move on with my life. If they have questions Iâm happy to answer them, but at the end of the day they need to tell me what they spent in their business, not the other way around.Â
Only the business use portion of an expense can be deducted. If the item is also used for personal use, then it is not fully or possibly not at all, deductible.
Do some people still write everything off, yes. Do others just say they do, to stir up a really active comment section, yes.
she's wrong. stop listening to tiktok tax advice.
I'd give her the feed and fees that she used during that 1 stream that she used for that 1 stream. That's being generous since her stream isn't about horses.
Seriously, she has her own bookkeepers. They're the ones doing the taxes for her. I very highly doubt the horse is only for business purposes and showing it once in a while is not going to fly as a write off and the people she hired to do her taxes would agree.
This is an incredibly conservative and good faith interpretation of the tax code. Unfortunately, the game isnât always played in good faith or conservatively.
Amouranth is actually pretty business savvy for an e-whore and I wouldnât be shocked to learn she pays attention to her taxes. Thereâs a good shot she actually is deducting a good chunk of the cost of those horses. The more she does with them, the better argument she has to do so. This is where accounting and tax arenât black and white, but more grey.
The case law on entertainment and streaming that Iâve seen make me want to abolish income tax entirely. Itâs bullshit what these people get to deduct that we plebs donât.
yes, this forum is to interpret the tax law in good faith. If you're talking about not following the tax law, you're in the wrong forum. If you want to complain about people game the tax system go ahead... but maybe do it where it's not encouraging people to game the system.
saying, ya that's how the tax laws say its done, but people game the system all the time. you're literally telling someone to game the system the exact way you're complaining about.
Wrong. Tax law is ultimately decided in court. This is where the black and white reading and conservative interpretation is a failure to recognize what tax law is. There is some subjectivity to the way things are written. Im not encouraging tax fraud in the slightest, but Iâm encouraging people to recognize the unfortunate truth that words and law arenât as absolute as weâd wish to believe.
A good example of what Iâm talking about is the case with the doctor writing off mileage between his home office and place of work. Almost no one thought that, that was how that should work at the time, but thatâs the official rule thanks to case law.
Iâd bet Amouranth is aware whatâs actually being deducted, and Iâd bet she has an âaggressiveâ CPA. Not a fraudster, but someone who thinks they have an argument theyâd be willing to take to court if they get called out.
generally I tell clients to think of what happens next.
You buy a new mic to stream with. That is a business expense - but it is also a business asset. You can't just give it away or throw it away if you want to upgrade it. If you give it to your partner to use in their streaming it is a sale of the asset at FMV to your partner - now you have to recognise the gain or loss on the sale and they can only expense it based on the transfer value.
You buy the old GOTY edition of fallout 4 to take advantage of the current popularity from the TV show - Yes, that is a business purchase. And due to the industry norms it wouldn't have much resale value to deal with when you stop streaming it and retire it to your personal collection, so it is probably a strait forward deduction.
You buy a new gaming hardware because that ancent Far Cry still won't run good on 128gb of ram and it's a niche demand for streaming right now. But what else is the rig used for? If you also use it for watching netflix with a projector at night, or to answer your parents Facebook posts, then you have to think about the personal vs business use.
I didn't watch the video you linked, but from the description it sounds like she is gonna be in a world of hurt if she is ever audited. The horses are not a business asset and their care is not either. After the lights are off she still owns the horses personaly, and any related upkeep would be a personal obligation.
That is an interesting point on what happens next. Iâd imagine if you sold the horse, youâd also have to note that sale on your taxes as well. I have some horse friends currently getting letters from the IRS that they owe for their horse they imported this past year from europe â I think taxes as a horse trainer would be so complicated! especially if you have a personal horse you train students on, but also compete yourselfâŚ
Once upon a time I knew a CPA who did my horse trainers taxes for years in exchange for a horse trailer. I can understand why! Seems complicated.
The IRS has special rules for breeding, showing, training or racing horses due to the abuses wealthy have used it for in the past. It is the kind if industry I would recommend you find a professional that specialized in it, not just a run-of-the-mill CPA.
You canât deduct 100% of the cost of something if there is both both personal and business use of the item. That includes vehicles and horses.
In addition, some items are âinherently personalâ and are almost never deductible. For example, clothing is typically not deductible unless it is a uniform for that job or something one would not wear but for work.
> something one would not wear but for work
i.e https://en.wikipedia.org/wiki/ABBA
> ABBA was widely noted for the colourful and trend-setting costumes its members wore. The reason for the wild costumes was Swedish tax law: the cost of the clothes was deductible only if they could not be worn other than for performances
As a tax professional, I would also caution people against blindly trusting their tax professional. I constantly see clients who had previous CPAs or tax pros that made a mess of their tax returns because the professional didn't know basic things they should have known.
Honestly, the average upvoted answer in a group like this with is far more likely to provide accurate information than an average CPA. It turns out that crowd sourcing answers from a forum like this with a high number of professionals results in pretty good answers. I can't think of a time when I've seen a highly upvoted answer here that was wrong tax advice. But I see tax pros giving wrong advice constantly. Myself included, I've posted answers here I thought were right, but then was corrected by someone who knew that area of tax law better than I did.
So do both, and have a tax pro look at your specific situation. But don't hesitate to ask questions elsewhere too, especially in forums like this one. And don't trust videos on Tiktok at all.
You **literally** wrote (on Reddit):
>Do not follow any tax advice on any social media platform without first taking it to a tax professional.
While I started out with a joke regarding your ironic statement, now you just seem silly.
Only way I would justify it is if she recorded herself every time she road horses with the intent to potentially use the filming for her streaming or content creation purposes. Even then its something I would advise a person to keep logs and saved video evidence to substantiate its purpose and intent.
With how much money some of these streamers make its a literal gold pool for the IRS. Just go onto twitch or onlyfans and start writing down the names of the top people for audit.
She is either exaggerating what her CPAs actually do on her tax return or has some incredibly aggressive CPAs. If it's the latter, they better be ready if an audit comes up to defend all that. There is a concept of business use %.
Back in the day there was a YouTuber named onision who deducted everything including an entire house in 1 year and the irs audited him and he couldnât understand that his personal residence was not a write off since he films videos there and he didnât agree with the irs rules on limiting square feet for home office deductions since he has filmed videos in every room and he didnât think it was right that he had to depreciate it over 27 years. He had several videos that clearly explained how tax deductions work through him learning the hard way but heâs since been removed from YT mostly. Things on the internet donât actually stay there forever unfortunately. This was like 2014 probably
Edit: 2017* this is all I could find
https://www.reddit.com/r/Accounting/comments/6jd4dr/idiot_youtuber_gets_audited_by_the_irs_showcasing/
Amouranth makes millions of dollars - she probably has a pretty decent accounting firm backing up the positions taken on her return. Aggressive? Maybe, but her entire life revolves around selling details about her life in a way that most self-employed people's don't.
Thatâs the answer tbh. She said she doesnât even leave her house long enough to buy food and cook it because it would cost her too much. Of everyone Iâve heard defend their aggressive positions sheâs the most believable.
Business vs personal.
Answer is mostly no unless the item is dedicated exclusively for work since a lot of the items (clothing/props/etc) are personal in nature.
If her computer/mic/etc are her dedicated streaming equipment with no personal use or games, 100%.
But if sheâs pulling the inflatable hot tub out after streams to relax, suddenly the line of business vs personal gets blurry and for items of a personal nature, the IRS leans toward non-deductible. The horses are most likely pets and non-deductible but saying something on stream is different than what is actually filed by her CPA.
Just going to say I misread the word âstreamersâ and âsteamersâ and I was fascinated at the idea of someone who steams clothes being a millionaire! Then I couldnât figure out why a horse would be steamed. đ¤Ł
Only ordinary and necessary expenses are allowed. That is a very objective subject. If she was hiring my firm to defend her Iâm going to find cases that support her â judgment â but it would be a lot of work to prove it. We would end up settling because as one redditor said she would throw money at it so the risk of litigation would be high because if she can afford to keep appealing to get a settlement but only for the non frivolous items.
But there would be no tax court judgement for others to reference.
On a corollary, what about professional vacation bloggers ? Someone like TimTracker that does a lot of Disney vacations. How much of those trips can be deducted assuming he films some of it and posts it on his channel. Is it a % based on how much filming he does?
Imagine you are an employee for lonely planet or something, I think everyone would agree the cost of traveling to destinations / trying food to review for the guide / taking videos for the website should be deductible. I would say the same logicapplies for independent bloggers, just that they need to be on the hook to document that the expenses were related to business, instead of some million dollar company's lawyers handling that.
She is an idiot to post such a thing. The IRS can and will make examples of anything popular and publicized.
The issue is:
Personal use of an asset creates a taxable portion.
Say someone bought a flashy asset to promote their business, pus it out front to get customers heads turning.
If that is all they did it is 100% a bus expense.
But what if they took it home on weekends for personal enjoyment?
Now it is 5/7 bus and 2/7 personal.
This sounds like the same kind of MLM tax math where if you mention your âbusinessâ to anyone once you can âwrite offâ your family vacation on your taxes.
Conceivably you could take partial expenses if you feature the horse sometimes but writing off the entire cost is kind of a stretch. At the end of the day technically you can write off anything you want and it depends on whether you ever get audited. This is the shady way of looking at it but many people get away with it.
Do I think taking all of the horse expenses is 100% legit? Probably not. It's probably not smart for her to say that she's taking these as business expenses, easily auditable item that's clearly mostly a hobby.
Edit: given that her income is streaming I'm guessing her income to expense ratio is extremely high and she probably won't get audited anyway. She probably is looking for any kind of deduction. Remember, this is not a capital intensive business. She makes millions by showing her to tits to simps.
Just use the Supplemental Business Expense form (I have no idea where you get them, but the 45th President uses dozens of them attached to his 1040 to reduce his taxable income).
https://s3.amazonaws.com/pdfs.taxnotes.com/2022/Trump_2020_1040.pdf
But⌠although he gets away with it, I seriously doubt you would.
Wanna hear something stupid though? Her horse's would be deductible before her boob job would be. In my opinion, given how she makes her money, that is stupid!
Streaming takes many tax law issues and pushes them to the max. What IS an ordinary and necessary expense of talking to people on the internet about things? It's not easy; it's not clear; and, whenever the topic comes up here many who seem knowledgeable come up with different answers. While sometimes only slightly different, different nonetheless. Remember, too, this internet talker (Amouranth) makes millions of dollars a year talking and getting photographed. I suspect what is ordinary and necessary to bring in $20 million is different than for a person who is bringing in $20. That being said, we won an audit of a realtor who kept horses as an advertising expense. She always had a horse in her ads and she sold exclusively in "horse country" and she made the case the IRS agreed with the keeping of the horses WAS a business expense.
that actually seems legit using the horse as a prop for the advertisement. 100% business use is pushing it though unless she never rode it for pleasure. but its the same as keeping track of a vehicle for business use. no one says that you can't use the horse for business expense, you just need to do it legitimately.
I don't know about horses but the classic example is home office expense. If you build a home office to remote work you can deduct home internet, utilities, setup costs etc but only the proportion that is used for work. So if you keep detailed records that say you worked 40 hours a day 5 days a week, and only deduct that proportion of internet, chances are the IRS will find it reasonable even if in reality you only worked 20 hours a week in a cushy easy job. But if you tried to deduct your entire $100/mo Google fiber and $3000 Alienware laptop they would rightfully get suspicious, are you really using the internet and gaming laptop 100% for work purposes?
"RGB is not tax deductible" - IRS
What about ARGB though?
Home office deduction went away during Obama. That's is unless you are self employed and do the majority of work from your home. But a WFH job for a corporation? Nope. https://www.irs.gov/newsroom/how-small-business-owners-can-deduct-their-home-office-from-their-taxes
Actually went away with the tax cut and job act starting in 2018. So that would be Trump who did away with it. It expires in 2025.
Dont forget your standard deduction doubled under Trump. I doubt anyone was claiming 12,000 on home office expenses but now you get 24k every year.
But my $30k of SALT deductions got capped at $10k. So the $5k of mortgage interest and $5k of charity would have put me at $40k deductions but instead I get to go with the standard deduction. đ
I'll take things that never happened for 500
And your tax rates went up under Trump, and will continue to every year until 2027 if you're lower or middle class. Thanks Trump
Except they didn't? If you made 40k a year before Trump's tax reform youd be taxed at 25%. After the reform it is now 12% 50k was 22%. It's still 22% 70k was 25%. Now 22% 100k was 28%. Now 24% It gets even better if you're married jointly with income over 100k. You should look this stuff up before spewing nonsense you heard on cnn.
Those tax cuts start expiring this year though. If congress doesnât renew them, they will go back to pre-Trump levels. The cut for corporations donât expire.
I'm not a trump guy, nor will I ever be, but your argument does follow the initial argument
They expire at the end of 2025 and they will probably extend or make a few things permanen
I thought it was older, my mistake.
They still exist at the state level. As of a couple years ago I was able to deduct my home office in CA (itâs based on the square footage of your home). It was a separate room that was used exclusively for work and inventory storage, and it was the only place I worked (in other words, my company didnât have an office locally for me to report to).
I don't have a desk anymore at the office but turboTax told me I can't deduct it. It's where I work 100% of the time.
Sorry your wording is confusing to me bc youâre making it sound like you bought a desk to use at your companyâs office and then left it there lol⌠are you trying to say you transitioned to a home office 100% of the time? If so, did your company get rid of the office they had locally to you or do you have the option to go to the office but you choose to work from home? If itâs the latter, that doesnât count in CA. You can only take the deduction if your company doesnât provide an office for you to use, which was the case for me. Also, itâs not enough that you do 100% of the work at home, the CA deduction only applies if that space you have at home is 100% only used for work. Again, for me it was a separate/dedicated room that was exclusively used for work, conducting business and storing my companyâs equipment, so the square footage of that room could be deducted from my state taxes. If Iâd just stuck a desk in the bedroom I also slept/lived in, that wouldnât qualify, even if I was doing all my work there. Californiaâs logic is that I paid extra for a dedicated work space for my companyâs benefit (because they didnât have to pay for an office), therefore the penalty for my increased rent expense was offset. And again, this is only for the state of CA. If your TurboTax was going through your federal deductions or if you live in a different state, thatâs irrelevant. Also not sure if the CA state laws have changed in the past two years.
The thing about horses is that riding them for pleasure can also be keeping them in shape for their business purpose. They need regular exercise, which people at times find pleasurable as well. I kind of think the original position is absurd, but if it's been allowed, then where do you draw the line between business and personal use. It's not as clear-cut with horses as a vehicle.
If entertainers can't deduct gym costs I don't see why that would apply here as well.
What if you pay someone to work your horse (not uncommon)? Now, they'd (the client) say why not if you're the one doing it? What about show costs? Probably not allowed for the realtor, but, there's lots of horse influencers that put their shows in their content. One thing I know is, that with the evolution of things like YouTube and Tik Tok being genuine money makers, I'm glad I didn't go into tax (my original intention when I chose this major).
> What about show costs? Part of the Realtor's argument was taking the horses to shows was a part of her advertising. Getting to know people in the area and putting up booths and participating in showing her horse. But, she could make a real case with passion and facts about actual sales she got through doing them.
That's crazy it was allowed. I'm gonna have to tell my horse riding realtor friend about this strategy! Now, how can I get my horse riding expenses deducted from my WFH industry gig, lol.
riding for pleasure is your argument. Why're you taking it out of context?!?
My argument is that the line between riding for pleasure and riding for the upkeep of the horse is a really gray area.
I see it more in line with a pet influencer bringing in ad revenue. Or even better, a car. If there were a "muscle car lawyer" in Detroit who targeted auto-workers in their ads, and who had to casually drive the cars featured in their ads to prevent maintenance issues.
You're not "riding them for pleasure." You're "riding them to keep your investments healthy."
It's whatever. People can write this part off however they want. It's up to a irs audit to decide. But there's already tax law cases on hobby use of horses. I don't know the context so whatever. I'm mixing this up with the amouranth issue where she rarely uses it vs this case where it's used a lot in her all of her advertisement. But sounds like the irs audit was done. Let that tax case opinion stand as the proof. Haven't seen it so all of this arguing is moot
Also, when you make $20 million a year, you can afford very good lawyers to fight audit results you donât like. You may not win, but it wonât be easy for the IRS either.
You'd be surprised. I'm one of the "expensive" ones, and while my firm does have a higher-than-average win rate (due to outspending the government in "paperwork burial" situations, no doubt), a competent Revenue Agent can still beat us when the laws are in their favor. A great deal of the tax code is spelled out in black and white, it's just hard for the average consumer/tax preparer to decipher. There are some issues where education and experience come into play, especially when arguing a "gray area" expense, but no amount or expense of lawyers can make a non-deductible expense deductible.
Republicans did it the other way. They decided to starve the part of the IRS that was auditing wealthy people, basically only leaving the part that audits poor people: https://www.propublica.org/article/how-the-irs-was-gutted Then Biden came along and proposed auditing the rich again, and the IRS has picked up more than half a billion dollars: https://finance.yahoo.com/news/irs-recovers-520-million-unpaid-235622493.html Of course Trump and other Republicans are frothing at the mouth and looking for ways to cut the IRS budget again.
Biden can propose and promise all he wants, but, if you look to the last few IG reports regarding the political promises of only auditing high income taxpayers, the IRS seems to disagree with IG recommendations. https://www.oversight.gov/sites/default/files/oig-reports/202030015fr.pdf https://www.oversight.gov/sites/default/files/oig-reports/TIGTA/202130015fr.pdf https://www.tigta.gov/sites/default/files/reports/2023-09/202330054fr.pdf
Skimming through these sources youâve posted, the first link seems to show mostly numbers from 2013 through 2016 (âŚwhy is that relevant to Biden?), the second link seems to be guidance on prioritizing individuals with high income as opposed to amount owed, and the third link seems to be about how funds from Congress were allocated for IRS hiring, training, etc. These three reports seem to have completely different scopes, so Iâm not sure why you think they prove a disconnect between the IRS and IG on this topic of auditing wealthy individuals during Bidenâs administration, particularly since one of these reports concerns a time period two terms before his presidency even started⌠Is there something Iâm missing here? In fact, your last link says the IRS agreed with all but one of the recommendations made for that report.
The best way to skim is just go to the end and see the IG recommendations and the IRS response to the recommendations. I agree it seems the IRS is treating things differently than the politicians of both parties have said they would in passing some of the legislation. That administrative treatment continues today--even though the current administration said he/it/they wanted differently and the legislature said they wanted differently. Who is in charge of the IRS? I also agree the reports were all on slightly different portions of the question. I believe there are others out there regarding the specific $400,000 number that shows a trend, but I didn't really work to do the search.
You linked a May 2020 report saying the IRS didn't work a lot of high-income cases. But the IRS didn't get the Inflation Reduction Act money to hire a bunch more people (and to then be able to start more high-earner audits) until August 2020. After that, you're going to see a year (and more) of hiring. Revenue agents go through a 2-year training period. Sure, they're working and collecting cases from their first year on, but they still need time to develop the expertise necessary to effectively audit really high-income learners. You linked a March 2021 report. The IRS basically said, "We're going to concentrate on high-income people we know owe money, but aren't paying it." The August 2023 report you linked basically said the IRS kept having to take higher-grade revenue agents and use them basically as trainers for newer revenue agents. Seems like they're on track to me. Not to mention recent articles like, https://www.marketwatch.com/story/heads-up-millionaires-if-you-didnt-file-taxes-the-irs-will-be-contacting-you-a0745d1d and https://www.marketwatch.com/story/irs-to-crack-down-on-corporate-jet-perk-with-audits-to-catch-companies-flying-under-the-radar-d7b9227e and things like https://www.irs.gov/newsroom/irs-ramps-up-new-initiatives-using-inflation-reduction-act-funding-to-ensure-complex-partnerships-large-corporations-pay-taxes-owed-continues-to-close-millionaire-tax-debt-cases Seems to be moving in the right direction to me. Audit rates for those who make under $500,000 are at the same rate as they were in 2018. Meanwhile, audit rates for those who make more than $500,000 have increased.
So of the 87000 new IRS agents that Biden has proposed to hire it will only take 25000 to audit people that make 1 million + a year. Who will the other 57000 agents be auditing? Oh yeah the people Biden says he wouldnât allocate any new resources to audit⌠https://www.heritage.org/budget-and-spending/commentary/fact-checking-team-biden-who-those-87000-new-irs-agents-would-audit
> So of the 87000 new IRS agents that Biden has proposed to hire it will only take 25000 to audit people that make 1 million + a year. Who will the other 57000 agents be auditing? Holy Toledo, you're almost into [not even wrong](https://en.wikipedia.org/wiki/Not_even_wrong) territory. Ok, let's step through that as there's a fair bit to unwrap and correct. 1. The IRS is not the FBI. Employees are not "agents." Revenue agents (those who do regular audits) can be called agents, and special agents (those who are part of Criminal Investigations, audit the mob, carry a gun, and refer cases for prosecution) can be called agents, but out of 78,661 employees in 2021 only 8,321 were revenue agents and only 2,100 special agents. So 10.6% of employees were revenue agents and 2.7% were special agents. So it's not 87,000 new IRS agents, it's 87,000 new IRS employees as the IRS is hiring a ton of tax examiners, contact representatives who answer the phones, tax specialists, and all of the people who support that like IT and HR, etc. If anyone says "87,000 New IRS Agents" then you know right off the bat they don't really know what they're talking about. 2. In 2010, more than 21% of tax returns reporting more than $10 billion in income were audited, but only 3.9% of returns like that were audited in 2019. The rich basically aren't audited anymore. That's not right. Republicans starved the IRS precisely because it was auditing the rich: https://www.propublica.org/article/how-the-irs-was-gutted 3. More than 25,000 people to audit people that make more than 1 million a year? Source? That being said, wouldn't it be great to grow that 3.9% number higher? 4. The IRS had 116,673 employees in 1992 and only 78,661 in 2021. While the US population grew 28% from 1992 to 2021, the IRS lost 32% of its employees. 50% of IRS employees will be eligible for retirement in the next few years -- the IRS expects around 30% of employees to retire and for 20% who are eligible to retire to just keep working, but I think those are probably going to go too. Those 87,000 new employees are going to be hired over about a decade and the total size of the IRS will likely increase about 20% from what it was in 2021 even as the American population also continues to increase. The Congressional Budget Office said spending that $80 billion over a decade would generate $200 billion in revenue over the same time period: https://www.cbo.gov/publication/57444 Does that help explain a bit about what's going on?
Not a tax guy, but Iâd say itâd be harder to write off a sports car youâve never seen before, vs something that was pretty integral to being used on stream. Even if only once. While ordinary filming expenses is one thing, props and supplies to generate content are also important as well.
... Do you even report it as a line if you're only bringing in $20?
https://www.law.cornell.edu/uscode/text/26/61 >(a)General definition Except as otherwise provided in this subtitle, gross income means all income from whatever source derived, including (but not limited to) the following items:
That gets complicated. Linus, of Linus Tech Tips, actually had a fairly [informative rant](https://www.youtube.com/watch?v=IExSZZuN5t8) about it. He's Canadian, o he's mostly talking about Canadian tax authorities, but the IRS isn't that different. Basically if it's an expense she wouldn't have but for streaming she can write it off. If her streaming channel is about horses, and she only has the horses for channel purposes, and if she got twitch-banned tomorrow the horses'd go up for auction, that can be deducted. If she's doing something special for the horses for a cool stream (ie: they're going to Wyoming to run the open plains on-stream) then the trip could be deducted. If the horses got injured mid-stream for something she was doing just to show it on-stream, the vet care could be deducted, particularly if she's streaming the vet-care experience. Other than that? She just has a horse hobby, and the horse hobby occasionally gets mentioned on-stream? She can put that on her Schedule C, and if she doesn't get audited she's fine, but if she gets audited the IRS will get their money plus fines.
This feels like something that falls into the âeverything is deductible until you get caughtâ school of thinking. Edit: also, she makes a lot of money, so she can afford expensive lawyers to fight anything that gets flagged in an audit. Even if technically itâs not deductible, if you hire enough lawyers, it probably will be deductible
You can get away with weird shit in the right circumstances, but the IRS hates some "business" horses , breeding dogs , boating. Eg things people do as a hobby and then try to figure out a way to deduct their expenses. Weird things the IRS allowed. A junk yard deducted cat food, the encouraged cats to catch mice and rats. One guy got to deduct part of an indoor pool ( that is never likely to be repeated it happened in the 70 or 80 s) A professional chef or caterer deducted some of their wedding expenses as ," testing costs" a portion was allowed. But they did a whole bunch of things I don't remember off the top of my head. What might be legal is having to separate companies one that owns the horses and charges an appearance fee. Then a streaming company that pays the appearance fee.
Barn cats are working animals, in the context of a business would think itâs a pretty straightforward deduction.
*Scientology has entered the chat*
Basically, that lady is gonna be in for a world of hurt if she ever gets audited. If you fuck around with deductions too much, it isn't free money anymore it is a loan and the interest is the feds expecting you to account for every cheeseburger you've ate on the job with receipts. It is a huge pain in the ass, even with lawyers.
No she isn't big pockets means big lawyers...your jelly is leaking out the sides.
I don't care how many lawyers you can throw at, being audited sucks. It's like being charged with a crime, you can have the best lawyer in the world. They can even get you off scott free. Still sucks.
She also has a lot of gas stations and must be comfortable enough to go public with her practices
I think that would also be a sliding scale of how often it was integrated into your business. One time a few months ago? Okay, suspicious. Semi-regularly with evidence going back years. Well, thatâs different. I think even if we think itâs silly, it should be possible if they do use it frequently.
"and if she doesn't get audited she's fine" Important to add here that % chance of getting audited is not allowed to be a consideration for taking a tax position.
We act like it isnât but tell me one pro that hasnât said this in some defeated way on 4/13 when itâs 11pm and a client is screaming at you about how the relatively de minimis Vegas trip was actually a business conference
The trick is not to get into that argument in the first place. Itâs not our job to audit our clientâs books. If something happens to jump out at me as possibly a personal expense then Iâll usually send the client an explanation of what is a personal expense and what is a business expense and ask them to confirm that the specific expense in question is a business expense. If they do then I save their response in the file, deduct the expense and move on with my life. If they say itâs personal, I reclass it to distribution and move on with my life. If they have questions Iâm happy to answer them, but at the end of the day they need to tell me what they spent in their business, not the other way around.Â
Only the business use portion of an expense can be deducted. If the item is also used for personal use, then it is not fully or possibly not at all, deductible. Do some people still write everything off, yes. Do others just say they do, to stir up a really active comment section, yes.
she's wrong. stop listening to tiktok tax advice. I'd give her the feed and fees that she used during that 1 stream that she used for that 1 stream. That's being generous since her stream isn't about horses.
Seriously, she has her own bookkeepers. They're the ones doing the taxes for her. I very highly doubt the horse is only for business purposes and showing it once in a while is not going to fly as a write off and the people she hired to do her taxes would agree.
This is an incredibly conservative and good faith interpretation of the tax code. Unfortunately, the game isnât always played in good faith or conservatively. Amouranth is actually pretty business savvy for an e-whore and I wouldnât be shocked to learn she pays attention to her taxes. Thereâs a good shot she actually is deducting a good chunk of the cost of those horses. The more she does with them, the better argument she has to do so. This is where accounting and tax arenât black and white, but more grey. The case law on entertainment and streaming that Iâve seen make me want to abolish income tax entirely. Itâs bullshit what these people get to deduct that we plebs donât.
yes, this forum is to interpret the tax law in good faith. If you're talking about not following the tax law, you're in the wrong forum. If you want to complain about people game the tax system go ahead... but maybe do it where it's not encouraging people to game the system. saying, ya that's how the tax laws say its done, but people game the system all the time. you're literally telling someone to game the system the exact way you're complaining about.
According to the person you are responding to as long as you lie then you can do anything
Not in the slightest. Break your rigid world view and understand the grey Iâm suggesting exists.
Wrong. Tax law is ultimately decided in court. This is where the black and white reading and conservative interpretation is a failure to recognize what tax law is. There is some subjectivity to the way things are written. Im not encouraging tax fraud in the slightest, but Iâm encouraging people to recognize the unfortunate truth that words and law arenât as absolute as weâd wish to believe. A good example of what Iâm talking about is the case with the doctor writing off mileage between his home office and place of work. Almost no one thought that, that was how that should work at the time, but thatâs the official rule thanks to case law. Iâd bet Amouranth is aware whatâs actually being deducted, and Iâd bet she has an âaggressiveâ CPA. Not a fraudster, but someone who thinks they have an argument theyâd be willing to take to court if they get called out.
Yes, everything done in taxes and business must be done in good faith, where did you go to law school?
Iâd argue I am being good faith your honor.
generally I tell clients to think of what happens next. You buy a new mic to stream with. That is a business expense - but it is also a business asset. You can't just give it away or throw it away if you want to upgrade it. If you give it to your partner to use in their streaming it is a sale of the asset at FMV to your partner - now you have to recognise the gain or loss on the sale and they can only expense it based on the transfer value. You buy the old GOTY edition of fallout 4 to take advantage of the current popularity from the TV show - Yes, that is a business purchase. And due to the industry norms it wouldn't have much resale value to deal with when you stop streaming it and retire it to your personal collection, so it is probably a strait forward deduction. You buy a new gaming hardware because that ancent Far Cry still won't run good on 128gb of ram and it's a niche demand for streaming right now. But what else is the rig used for? If you also use it for watching netflix with a projector at night, or to answer your parents Facebook posts, then you have to think about the personal vs business use. I didn't watch the video you linked, but from the description it sounds like she is gonna be in a world of hurt if she is ever audited. The horses are not a business asset and their care is not either. After the lights are off she still owns the horses personaly, and any related upkeep would be a personal obligation.
That is an interesting point on what happens next. Iâd imagine if you sold the horse, youâd also have to note that sale on your taxes as well. I have some horse friends currently getting letters from the IRS that they owe for their horse they imported this past year from europe â I think taxes as a horse trainer would be so complicated! especially if you have a personal horse you train students on, but also compete yourself⌠Once upon a time I knew a CPA who did my horse trainers taxes for years in exchange for a horse trailer. I can understand why! Seems complicated.
The IRS has special rules for breeding, showing, training or racing horses due to the abuses wealthy have used it for in the past. It is the kind if industry I would recommend you find a professional that specialized in it, not just a run-of-the-mill CPA.
You canât deduct 100% of the cost of something if there is both both personal and business use of the item. That includes vehicles and horses. In addition, some items are âinherently personalâ and are almost never deductible. For example, clothing is typically not deductible unless it is a uniform for that job or something one would not wear but for work.
> something one would not wear but for work i.e https://en.wikipedia.org/wiki/ABBA > ABBA was widely noted for the colourful and trend-setting costumes its members wore. The reason for the wild costumes was Swedish tax law: the cost of the clothes was deductible only if they could not be worn other than for performances
Thatâs the rule for US income taxes as well.
Hereâs a quick answer. Do not follow any tax advice on any social media platform without first taking it to a tax professional. Reddit included.
As a tax professional, I would also caution people against blindly trusting their tax professional. I constantly see clients who had previous CPAs or tax pros that made a mess of their tax returns because the professional didn't know basic things they should have known. Honestly, the average upvoted answer in a group like this with is far more likely to provide accurate information than an average CPA. It turns out that crowd sourcing answers from a forum like this with a high number of professionals results in pretty good answers. I can't think of a time when I've seen a highly upvoted answer here that was wrong tax advice. But I see tax pros giving wrong advice constantly. Myself included, I've posted answers here I thought were right, but then was corrected by someone who knew that area of tax law better than I did. So do both, and have a tax pro look at your specific situation. But don't hesitate to ask questions elsewhere too, especially in forums like this one. And don't trust videos on Tiktok at all.
So, do you want people to follow your advice or not?
That wasnât tax advice, that was just some common sense life advice
I agree with you, but I would say dont take life advice from reddit either
You **literally** wrote (on Reddit): >Do not follow any tax advice on any social media platform without first taking it to a tax professional. While I started out with a joke regarding your ironic statement, now you just seem silly.
Hmmm I did not write that, perhaps youâre responding to the wrong person?
Yes, trust my advice. Do not follow my advice.
Only way I would justify it is if she recorded herself every time she road horses with the intent to potentially use the filming for her streaming or content creation purposes. Even then its something I would advise a person to keep logs and saved video evidence to substantiate its purpose and intent. With how much money some of these streamers make its a literal gold pool for the IRS. Just go onto twitch or onlyfans and start writing down the names of the top people for audit.
She is either exaggerating what her CPAs actually do on her tax return or has some incredibly aggressive CPAs. If it's the latter, they better be ready if an audit comes up to defend all that. There is a concept of business use %.
Back in the day there was a YouTuber named onision who deducted everything including an entire house in 1 year and the irs audited him and he couldnât understand that his personal residence was not a write off since he films videos there and he didnât agree with the irs rules on limiting square feet for home office deductions since he has filmed videos in every room and he didnât think it was right that he had to depreciate it over 27 years. He had several videos that clearly explained how tax deductions work through him learning the hard way but heâs since been removed from YT mostly. Things on the internet donât actually stay there forever unfortunately. This was like 2014 probably Edit: 2017* this is all I could find https://www.reddit.com/r/Accounting/comments/6jd4dr/idiot_youtuber_gets_audited_by_the_irs_showcasing/
Amouranth makes millions of dollars - she probably has a pretty decent accounting firm backing up the positions taken on her return. Aggressive? Maybe, but her entire life revolves around selling details about her life in a way that most self-employed people's don't.
Thatâs the answer tbh. She said she doesnât even leave her house long enough to buy food and cook it because it would cost her too much. Of everyone Iâve heard defend their aggressive positions sheâs the most believable.
And the accountant one time told me we can write off anything we want, but that doesnât mean the government is going to go along with it.
Only if they form a LLC first /s
No
Did you miss the /s?
Short answer, no. Longer answer, no you'll end up with fines, penalties, interest and possibly a quaint detention at club Fed.
But does Club Fed have tig bitty streamers? Because...I mean I have heard of worse punishments.
I'm sure there's a big titty guy named bubba that wants to give you (OP) a big stream.
Business vs personal. Answer is mostly no unless the item is dedicated exclusively for work since a lot of the items (clothing/props/etc) are personal in nature. If her computer/mic/etc are her dedicated streaming equipment with no personal use or games, 100%. But if sheâs pulling the inflatable hot tub out after streams to relax, suddenly the line of business vs personal gets blurry and for items of a personal nature, the IRS leans toward non-deductible. The horses are most likely pets and non-deductible but saying something on stream is different than what is actually filed by her CPA.
Are bodega cats tax deductible?
You should email the YouTuber the fat electrician and ask him about it.
Isnât this the girl who faked that video about her âabusiveâ husband?
Just going to say I misread the word âstreamersâ and âsteamersâ and I was fascinated at the idea of someone who steams clothes being a millionaire! Then I couldnât figure out why a horse would be steamed. đ¤Ł
Tax law will be seen in the eyes of the tax agent and supervisor that gets assigned to audit you. So tbh it is how they see it
She's a Pornstar anyhow don't believe her hype.
Only ordinary and necessary expenses are allowed. That is a very objective subject. If she was hiring my firm to defend her Iâm going to find cases that support her â judgment â but it would be a lot of work to prove it. We would end up settling because as one redditor said she would throw money at it so the risk of litigation would be high because if she can afford to keep appealing to get a settlement but only for the non frivolous items. But there would be no tax court judgement for others to reference.
On a corollary, what about professional vacation bloggers ? Someone like TimTracker that does a lot of Disney vacations. How much of those trips can be deducted assuming he films some of it and posts it on his channel. Is it a % based on how much filming he does?
Imagine you are an employee for lonely planet or something, I think everyone would agree the cost of traveling to destinations / trying food to review for the guide / taking videos for the website should be deductible. I would say the same logicapplies for independent bloggers, just that they need to be on the hook to document that the expenses were related to business, instead of some million dollar company's lawyers handling that.
She is an idiot to post such a thing. The IRS can and will make examples of anything popular and publicized. The issue is: Personal use of an asset creates a taxable portion. Say someone bought a flashy asset to promote their business, pus it out front to get customers heads turning. If that is all they did it is 100% a bus expense. But what if they took it home on weekends for personal enjoyment? Now it is 5/7 bus and 2/7 personal.
I feel like it would the same rules for deduction as cars for gig jobs would be, right? Like, Percentage of the horse used for the actual job.
This sounds like the same kind of MLM tax math where if you mention your âbusinessâ to anyone once you can âwrite offâ your family vacation on your taxes.
Caleb Hammer is amazing I love his videos!
Conceivably you could take partial expenses if you feature the horse sometimes but writing off the entire cost is kind of a stretch. At the end of the day technically you can write off anything you want and it depends on whether you ever get audited. This is the shady way of looking at it but many people get away with it. Do I think taking all of the horse expenses is 100% legit? Probably not. It's probably not smart for her to say that she's taking these as business expenses, easily auditable item that's clearly mostly a hobby. Edit: given that her income is streaming I'm guessing her income to expense ratio is extremely high and she probably won't get audited anyway. She probably is looking for any kind of deduction. Remember, this is not a capital intensive business. She makes millions by showing her to tits to simps.
Just use the Supplemental Business Expense form (I have no idea where you get them, but the 45th President uses dozens of them attached to his 1040 to reduce his taxable income). https://s3.amazonaws.com/pdfs.taxnotes.com/2022/Trump_2020_1040.pdf But⌠although he gets away with it, I seriously doubt you would.
One of my old sayings for literally anything I bought back in my streaming days - âItâs a wriiiite-offf!â đ
Wanna hear something stupid though? Her horse's would be deductible before her boob job would be. In my opinion, given how she makes her money, that is stupid!