Tax filing reminders for outdoorsmen as we approach Tax Day.
Believe it or not, hunting and fishing can (sometimes) be considered principle business activities, and therefore related deductions can be made when it comes time to file your taxes.
Above all else, we ARE NOT tax lawyers or CPAs, and you should always consult professionals if you have questions. There are exceptions to rules, and we are not properly educated in the kind of exceptions there are.
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But we can still give you a baseline understanding of some of the things you can do to make sure you are making the most of your outdoor lifestyle, most applicably when you run a business related to hunting or fishing.
1. Keep a record of EVERYTHING
If you operate a fly fishing guide service, or own a hunting lease, the number one reminder we can pass on is an obvious one, but it’s amazing how often people forget. Keep your records of purchases, transactions, trips, and just about any other business-related activity that could in some way, shape or form be tied to tax implications.
We stress this because, while we’d like to believe everyone obeys the tax laws, practices proper filing procedures and never makes mistakes, all of those things can and will happen. Because of that, the IRS is on the lookout for things that may not pass the sniff test, and rarely hesitate to execute an audit on someone if they are the least bit questionable.
Save receipts, and if needed, create your own receipt process so you can keep track of the money given to you. Consider a service like Shoeboxed, which can keep track of all receipts and other transactions with the use of your smartphone’s camera. Plenty of other tasks are made easier with Shoeboxed and similar services, so find one you’re comfortable and devote yourself to using it consistently.
2. Deduct often, but deduct fairly
Again, this is mainly for those outdoorsmen who operate a business related to their sport, most commonly a fishing guide or hunting guide.
You may not always think about it, but a lot of the purchases you make can be deducted on your taxes because they were business expenses. Think about it: if you bought six fly fishing rods so you could increase your guided group size, those can be deducted. If you provide meals (for yourself and your clients) during paid fishing excursions, you can deduct that money. If you bought a boat specifically for your guide service, that’s a big chunk of change that can be deducted.
Gas, health insurance, and even housing expenses (if you run your business from your home) can be deducted as long as they meet the proper requirements.
3. Become and stay compliant
This might even be slightly more important than the first reminder, because you can do everything right but still be in hot water if you aren’t qualified as a credentialed guide. Mostly involved in fishing guide services (since guides often take people out in their boats), these credentials vary from state to state, but are pretty much required across the board.
Make sure you’ve consulted your state and local regulations surrounding fishing and hunting guide services, because a perfectly filed tax return is moot if you’re not properly licensed.
There’s nothing worse than having the IRS on your case for not having the right credentials, then adding the US Coast Guard to the list of folks going after you because you broke the law. Take the time to obtain everything you need to conduct your business, and you’ll thank yourself when Tax Day rolls around.
Are there any further tips you would add involved with tax filing for outdoorsmen? Leave them below in the comments section.