Selling baits?

[mepperson]

I'm not trying to talk anyone out of selling because it is alot of fun. I just dont want to see any of my fellow tiers that I think are some alright guys get burned. I'm just letting you know what was told to me by other sellers and my accountant and it may seem like a big pain but it really aint takes like 15 minutes to get a state tax id number and apply for a EIN# after that just keep good records of your sales and cost.

Its part of the hobby that sucks but i figure its worth it.

JJ

Thanks Joe, I'm not talked out of it, just commenting on all of the posts. There's a lot more to it than I thought. I'm still gonna make baits because I enjoy it, but I like fishing a lot more. It sounds like it will be a lot of work trying to more than the hobby thing.

[shipahoy41]

I'm not so sure about that ship. when I called the IRS to see if there was a limit on when it stops being a hobby and starts becoming a business they told me if I sold 1 jig I had to claim the income and charge the %10 excise tax.

so with that said I would suggest that if you have a site and sell on it you might wanna do it right or take the chance and possibly get fined out the butt. Me I wont take that chance.

oh 1 more thing if you have a state tax id # and charge the sales tax and claim all that its even easier for the feds to track your sales so i would for sure get a EIN# from the IRS Then

JJ

I paid the 10% taxes etc. Last year on Dec.31st I quit selling and just tie for a few friends. My site is now into teaching people how to fish.

[mepperson]

I paid the 10% taxes etc. Last year on Dec.31st I quit selling and just tie for a few friends. My site is now into teaching people how to fish.

Cool, I need some lessons!

[Pup]

I'd like to pose the following questions to CDC's commercial tyers for input if you Fellows have the time.

1. Do companies like Wapsi or Danville pay the 10% federal excise tax (FET) on their finished materials (e.g. thread, chenille, flashabou) sold at retail?
2. Does holding a federal (or state) tax number allow you to purchase tools and materials at wholesale prices?
3. Do wholesale tool and material prices exclude the FET?
4. What do you do in the case where a manufacturer of material has paid the 10% FET and you use their material to complete your finished product in terms of FET payment?
5. Does the FET go toward Sport Fish Restoration projects? Are these the Dingell-Johnson/Wallop-Breaux monies?

Just curious. Thank you.

[Jiggin_Joe]

well pup im new to this but when you purchase from suppliers they do add the FET to the items that require it and you dont have to pay them the excise tax as long as they have the proper forms showing you charge the tax when you resell those items. Now I have been paying them the excise tax because i have'nt yet figured out what forms i need to send my suppliers to get me exempt from having to pay it so if someone knows the process please let us know.

JJ

[Timmy Tom]

I do believe it is a 637. You will have to meet with a IRS agent to obtain this form. You can get a break on excise tax from companies that offer it. Wholesalers and Manufacturers that is. You actually hide the 10% in your sale price to distributors, retail stores or end users (fishermen). Hiding the tax is stupid but if you get a 720 you will see alot of hid taxes on products. If you sold $550.00 this quarter you pay $55.00 to IRS. It is due per quarter. It has a grace period of one month. So the last quarter of 2009 is Oct. Nov. Dec. and forms and payment are due by Jan. 31 2010.


Pup

1. I would think 100%. Yes
2. Yes and no Depends on what they want. Min. orders and all tax papers/numbers.
3. Depends on tool.
4. Get 637. You still have to pay 10% at your selling price. No ifs or butts about that one.
5. Not sure about breakdown of monies but all monies go to land/water management.

TT

[Pup]

Thank you for the information Jiggin_Joe and Timmy Tom.

Interesting stuff.

[PBUG2009]

so what ever you make put it in an account and keep it there till tax time. keep all reciepts... let the accountant take care of it....thats how i do it

[flatfish46]

You have to file a 637 under a defined activity they will set up a appointment and come to Your place of business! and preform a audit on Your books and inventory! it took Me 4 hours and they can come back at any time with a 2 hour notice. Thats all!

[Jiggin_Joe]

I'll pay the %10 still lol

JJ