CHL business tax deductions

[Caltexshooter]

I am going in March to get my CHL Instructor certification and will be starting to train students as a part time business.
I was wondering how everyone does their taxes? Do you do itemized forms and what exactly are you able to deduct? Targets, classes, firearms, ??? Just wondering how everyone else does it?
Please help

[jbarn]

Welcome to the forum. Due to the penalties for doing it wrong, I strongly suggest an accountant. You will have to claim the income, pay taxes on it, etc.

[TomV]

I do something similar, but in a different field.

I registered my business with the state in 2013. I track all my income and expenses and give all that info to my tax preparer.

Good luck to you.

[baron]

I am going in March to get my CHL Instructor certification and will be starting to train students as a part time business.
I was wondering how everyone does their taxes? Do you do itemized forms and what exactly are you able to deduct? Targets, classes, firearms, ??? Just wondering how everyone else does it?

The general rule is ordinary and necessary business expenses are deductible. Some people over complicate it but if you keep good records and use common sense by not pushing the boundary of cheating, it's not too difficult. You can hire a CPA or tax professional if you like, and that's a good decision for some people, but always remember that when you sign the tax return you're the one on the hook, so check their work.

Congratulations on your decision to start a business.

[WildBill]

I am going in March to get my CHL Instructor certification and will be starting to train students as a part time business.
I was wondering how everyone does their taxes? Do you do itemized forms and what exactly are you able to deduct? Targets, classes, firearms, ??? Just wondering how everyone else does it?
Please help

I am not an instructor or a lawyer or CPA or an accountant. Unless this is a full time business or the majority of your income, I would not bother. I would think the fee of an accountant would cost more that your savings in taxes. That is just my opinion. YMMV

[AF-Odin]

I too am not a CPA, Lawyer, or Tax advisor, but agree with Baron. My wife has been a part time musician and piano teacher for years and we simply use one of the nationally available computer tax programs Small Business version and have had no problems. Be reasonable and KEEP GOOD RECORDS of what is business and what is personal. Don't push the envelope and start doing things like trying to deduct every new gun you buy or all the ammo/components you purchase.

On another note, Caltexshooter, I will be in the class with you in march. looking forward to meeting.
AF-Odin

[WildBill]

I too am not a CPA, Lawyer, or Tax advisor, but agree with Baron. My wife has been a part time musician and piano teacher for years and we simply use one of the nationally available computer tax programs Small Business version and have had no problems. Be reasonable and KEEP GOOD RECORDS of what is business and what is personal. Don't push the envelope and start doing things like trying to deduct every new gun you buy or all the ammo/components you purchase.

On another note, Caltexshooter, I will be in the class with you in march. looking forward to meeting.
AF-Odin

Good advice. Again, I am not a tax professional, but I have heard that if you deduct something such a computer, then you can only use the computer for CHL-related business if you want to deduct it. Or if you use the computer for other work you could only deduct for the percentage used for CHL. That would be very difficult to keep accurate records for that. Not worth it for me. I guess if you have to rent a place for your classes, that would be the biggest expense. That one would also be easier to keep accurate records.

[Jumping Frog]

The #1 piece of advice would be to establish a separate bank account and keep all funds related to revenue and expense flowing through the dedicated bank account. Do not intermingle the funds between your business and your personal checking account. WAY WAY easier to track the business related stuff that will affect your tax return.

Easiest way to do this is to go the IRS website and apply for an EIN for a sole proprietorship. It is free, zero cost. For example, "John Smith dba AAA CHL Instruction". You then use your IRS EIN paperwork to establish your bank account.

It is not required to form an LLC or other form of corporation. If you want to protect yourself from lawsuit risk, you can form an LLC if you want, but there are a million small businesses simply run as a sole proprietorship.

[airbornecpa]

Go to irs.gov and search for Publication 334, Tax Guide for Small Business (For Individuals Who Use Schedule C or C-EZ), that will serve as a starting point.

Section 61 of the Internal Revenue Code (IRC) 61 defines gross income as all income from whatever source derived. If some pays you money related to your business it is income. IRC 162 allows a deduction for the ordinary and necessary expenses incurred in carrying on a trade or business. What may be "ordinary and necessary" to a CHL instruction business: range fees for class, targets, course material, pens, pencils, stapler... What would NOT be "ordinary and necessary": silver tea set, airfare to Tahiti, refrigerator for your house... New gun - nope, do not deduct it

If you need it to be able to conduct a class, then it is probable deductible.

Keep good records, keep your receipts. I the event of an audit things will go much better for you if you can show where the numbers on your return cam from.

Expenses - If you deduct something, then have a receipt to document.
Gross income - If you have 10 people in a class @ $75 per head, then you better be able to show that $750 for that class was included in Gross Income.