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Anne
Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 1704
Experience:  Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
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Hello...Curious my accountant told me i needed to claim on

Resolved Question:

Hello...Curious my accountant told me i needed to claim on my taxes all antiques i have sold from my home as a side thing. I take care of my gardeners books in exchange for landscaping so there is no switch of cash. She told me to claim it also on my taxes so i questioned her about needing a license but told me not to worry about it because we were in a unincorporated area. Does this sound correct?
Submitted: 1 year ago.
Category: Tax
Expert:  Anne replied 1 year ago.

Anne :

Hi

Anne :

Thank you for using justanswer.

Anne :

You have 2 different things going on here.

Anne :

The first part is that you have sold antiques (that should have appreciated in value), and its that increase in value that you need to pay tax on.

Anne :

The other part of your question deals with "bartering"

Anne :

Anytime you trade something and you get something in return (such as you taking care of your gardner's books in return for landscaping)

Anne :

You must include the Fair Market Value of the landscaping that you received

Customer:

so does that mean i need a business license

Anne :

no

Customer:

and does that mean i ought to pay into social security too

Anne :

The sale of the antiques (which I assume is something you only do occasionally) is reported on Sch D

Customer:

yes

Anne :

that means you will only pay tax on the difference between what you purchased the antique for, and what you sold it for

Anne :

There is no SE tax on either one of these transactions

Anne :

your barter income would go to line 21 of the Federal 1040

Customer:

okay...do i pay into ss at some point

Anne :

not generally.........if you prepare your gardener's books on a regular basis, the IRS could consider that a business.

Anne :

However,

Anne :

For now, all you need to do is show the value of the landscaping on line 21 as "barter income"

Customer:

okay and in the future if i chose to expand how would i pay into ss

Anne :

Yes, if you decide to do other people's books for money or service, then that would constitute a business, and you would have to pay SS tax at that point

Customer:

what percentage is ss tax...30%

Anne :

.15%

Anne :

sorry 15%

Customer:

is boarding a business if from my property at my home or would that work the same way?

Anne :

boarding (or renting) out part of your home is filed on


2012 Form 1040 (Schedule E) - Internal Revenue Service

Anne :

and there is no SS tax associated with rental income or expenses

Customer:

do i need a business license for it?

Anne :

no...but if you rent to a business,, THEY need a license to do business

Customer:

okay...Thank you...you have been wonderful to answer these questions. I appreciate it and the peace of the knowledge as well.

Anne :

You're most welcome

Anne :

please feel free to ask for me by name if I can help you in the future

Customer:

Have a very enjoyable rest of your evening.

Anne :

Thank you, XXXXX XXXXX

Anne :

too

Anne :

lol

Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 1704
Experience: Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
Anne and 5 other Tax Specialists are ready to help you
Expert:  Anne replied 1 year ago.
Thank you very much for the accept, your excellent rating and your generous bonus!

Please feel free to ask for me by name if I can help you in the future.

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