One of my hobbies is to participate in promotional programs at local broadcast stations. I have a couple of potentially interesting questions that folks might want to take a crack at:
- When there is hobby income, you can deduct hobby expenses to the extent of that income. I'm trying to figure out what expenses I can apply to this hobby. No doubt, I could deduct some portion of my broadband service costs -- the proportion would have to be a guesstimate, though. More substantial, though, would be my mileage to the office of the broadcast station, to pick up prizes. Anybody care to venture an opinion as to the deductibility of mileage? What rate do I use? The business rate?
- I have a residential rental property. My tenants have kids. I will often take a family-oriented prize from the promotional program, and give it to the tenants. Does this constitute a deductible business gift? My "cost" for the gift is nothing (other than my mileage) -- but I win so much stuff that I sometimes get a 1099-MISC from the station, and the "value" of the gift turns into ordinary income (see above). I'm therefore obligated to pay taxes on these winnings. It would be nice to at least avoid having to pay the taxes on prizes I ended up re-gifting to my tenants. For the record, I'm a "boy scout" when it comes to these promo programs. I tend to declare *ALL* my winnings, whether or not I receive a 1099-MISC. Yes, yes. I know. I'm a sap. 8-)
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