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Real Estate Show Place Sept 271978 7 Dollar ene Profit from hobby may be tax free by Michael For some lucky people an activity that starts out as a hobby can urn into a live hood or at least a good money sideline Collecting antiques breeding purebred dogs restoring old cars painting writing fiction coin collect gambling Ihc list is end less and the extra cash brought in can sometimes be substantial If you re in this position turning a profit on your hobby beware that you are not in tax terms running a business as a sideline to your regular earnings If you are the income tax department requires that you report your profits and pay tax on them General financial advice by members of The Instil at Chartered Accountant of Ontario A Business may be defined as an enterprise in which money labor and skill arc invested to make a profit and in borderline cases the question of intent can become crucial You might not be taxed if your hobby money In one year perhaps as a result of selling one of your paintings after five years or so of falling to generate any net Income at all But if your activity turns a profit con year after year then you will probably be deemed to be running a On the other hand if you lose money you might wint to write off a loss against lar income by claiming out or pocket expenses as tax deductions In such a case the tax department or the will normally attempt whether you genuinely tried to profit from your activity and whether started the enterprise with a reasonable expectation of making a profit If the inter go against you your expanses will be con personal and deductible tor example if a rdu horse for md it in only j few races with no real hope of winning enough to make a profit Ills unlikely you will be allowed to write off expenses against your regular Income On the other hand if you buy three horses race them regularly and realize a net profit the department will almost certainly rule that you arc in the racing business and tax you accordingly But do deduct losses you must be able to show there was a reasonable expectation of making money and that you went about it in a business like way The only exception to lax rules on hobbies Is bobby farming a complex subject requiring specific profes si on a 1 advice Also if you are in fact in business consistently making profits from playing the piano or breeding orchids you ought to consider In corpora ting to benefit from a lower tax rate The lax saving benefits can some times outweigh the cost of incorporating Mr is with Camp bell Sharp Toronto I Make House A Superstar We do more than just show your house We show it off CENTURY 21 salespeople trained in everything from listing and showing your home to understanding real estate regulations When you list with CENTURY wo get action on your property and put our promises in So when you re ready to sell let CENTURY help you got the show on the JON REAL ESTATE INC Were the Neighborhood Professionals SUPER SEMI back split and roc shod and mo Call us n EXECUTIVE RETREAT pool Lincoln cor garago oil n quiet homo with Warranty is fully bruodloomod coil at 1134 Call Mull in VERY LARGE GARDEN LOT end lol ltd n co Fiords n prlcodat25 ALMOST COMPLETE THE BEST IS YET TO COME 1 lor 1h d llarod A Newly 3 fam ly tmng Floor twins lorn room Tudor stylo si bains 1 A car room firoplaco and a walkout rig GivoAlncol SEEING IS BELIEVING your dollar 3 buck and I nth carport Largo n Tudor adjacent to a coty Dulacliwf cut Call Jon tor view no JUST LISTED call lot BUILDERS CLEARANCE VALUABLE FARMLAND south Georgetown CO bank bom AUDREY ANNEPETO SALLY REED 877 6639 DODGE LINDA CLAUtJETTE 7627 CAMEADES JON ZORGE Jon Zorge Real Estate Inc 8770155 4572624 MEMBER BROKER S