March/April 2024 Issue

EAST COAST EQUESTRIAN March/April 2024 Page 73 BLACK’S LIVESTOCK -The Next Pasture - Where the grass is always green, lush & stirrup high Individual Horse & Pet Cremation Standard Mortality Emergency Service Available John E. Black: 610.220.5262 Matthew Hoffman: 610.656.3258 Office: 610.584.4482 Fax: 610.584.9111 BLACK’S LIVESTOCK P.O. Box 662 Skippack, PA 19472 www.nextpasture.com Tax Advice for Equine Professionals Kristina Vaughn, owner of Legit Ledgers, LLC., a 100% virtual bookkeeping and financial services business that specializ- es in the equine industry, and a Master in Accounting and Finan- cial Management and Certified Quickbooks Online ProAdvisor, has tax advice for equine business owners. • Employee Expenses – For small businesses, salaries, wages, commissions, and bonuses are tax-deductible as long as they are ordinary and necessary for business, a reasonable amount, for services provided, and paid or incurred in the current year. Other expenses can be whole or partial- ly deductible when an employee incurs expenses while working for the business. • Depreciation – Any large capital business investment fenc- ing, buildings, etc.), are treated as a depreciation expense. • Land Maintenance and Improvement –If you purchase pasture supplies, fertilize your fields, use fuel for churning com- post piles, etc., record the cost to save on taxes. • Licensing Fees – Licens- ing expenses to continue practic- ing or examination fees to keep your professional credentials are deductions. • Foster Animals –You can deduct ALL the expenses related to caring for foster animals, including vet bills, feed, and any other necessary costs, as charita- ble-gift deductions. • Subscription and Profes- sional Fees – Expenses you incur for access to professional pub- lications and collaboration with other equine professionals via membership fees are deductible. • Horses – If your horses are a “necessary and ordinary” cost of maintaining your business, all the necessary expenses of keeping them are tax deductions. Costs include but are not limit- ed to feed, training, grooming, veterinarian, supplements, farrier, deworming, dentistry, vaccina- tions/immunizations, breeding, boarding, etc. • Service Animals – Vet expenses for an animal to be used for the support of a disabled indi- vidual (visual, hearing, physically impaired) are deductible. For IRS proof, obtain paperwork from a medical professional or keep a training log and test records. • Health Insurance Premi- ums – If you run your own busi- ness and pay for your own health insurance, you can deduct the premiums as a pre-tax expense. • Travel Expenses – Trav- el expenses for your business (buying horses, going to shows/ rodeos, networking events, etc.) are all tax deductible. • Ordinary Operational Expenses –Make sure you claim everyday expenses including, but not limited to work clothing, business software, internet and utilities, facility maintenance, office supplies, tack, patient re- funds, administrative costs, feed buckets/supply, medical sup- plies/equipment, and grooming supplies. • Charitable Contributions – This can be a tricky area avail- able only to those who itemize. If you donate to many charitable funds itemizing may be the way to go for your business. • Farm Insurance –Pre- miums for farm insurance are completely tax deductible. • Merchant Fees – These deductions are commonly over- looked. Fees for merchant ser- vices that facilitate payments and money movement between your business, bank, and customers are deductible. • Guard Dogs – If your fur- ry friend is largely used to protect your horse barns from potential intruders, you can claim his vet expenses as tax deductions. • Retirement Savings – Contributions to an eligible 401(k) or other retirement fund are deductible up to a limit set by the IRS. • Registered Agent Ser- vices – If you have an LLC and hired a company to perform registered agent services for you (mail collections, etc.) the basic service fee and any supplemental items are tax deductible. • Small Business Mar- keting and Advertising – This includes the cost of providing meals, entertainment, or recre- ational facilities to the public as a means of advertising or promot- ing goodwill in the community. Always consult your finan- cial professionals for allowable amounts on tax deductible items. Expenses such as utility bills, vehicle repairs/maintenance, water, fuel, etc. which are partly used for personal purposes must be properly allocated. Be sure to note the difference between “current expenses” and “capitalized expenses.” Current expenses can be claimed all in one year as their useful life is expected to be less than a year. Capitalized expenses are those whose useful life can be esti- mated to last longer than a year. Many rules and exceptions exist for capitalized expenses. For more information contact Kristina.vaughn@legitledgersllc. com. Please submit your events to steph@eastcoastequestrian.net . Please provide event name, location, city, state and contact information for inclusion at no cost in East Coast Equestrian's calendar. Attention Event Organizers!