Work From Home Countdown - 112 Days

I really don't like watching those days countdown, but I have to have a specific target date in view as to not let too much time pass without taking some action.

Truth be known; I've actually been running my own business(es) on the side for some time now, but I haven't invested enough time, energy, or capital for them to actually support me. Then again, they haven't had to either.

When I started my first business I had been doing research for a while and ran across an article that discussed turning your hobby into a profitable business and mentioned some of the reasons to do so.

They stopped short of actually stating the primary reasons I decided to go ahead and make my photography hobby into an official business. These reasons for me were:

1. A business is allowed to show no profit or a net loss for its first 2-3 years of operation and then additional yearly losses after making a profit within a 5 year period. Be sure to consult a tax professional or read the appropriate IRS Publications covering the specific rules before you make any decisions based on this information.
   
   Essentially what this means is: even if your business loses money initially, you still make money because the losses will reduce the amount of federal tax you must pay or raise the amount of your income tax refund.
   
   Remember this: $1.00 profit is still profit.
   
   
2. The number of businesses that fail within the first 5 years of operation is staggering. This can be translated another way. If your business doesn't profit after the first 2-3 years you may be required to close it. However, that doesn't mean you can't immediately open another business doing the same thing under a different name or leave the business closed for a year and then reopen it.
   
   Again, make sure you consult the IRS or a legal professional prior to developing any strategy around this.

In my next post, I'll discuss some of my recent research and relay any strategies or resources I've found that may be helpful.