Implications of Starting a Small Breeding Business

[MrLang]

Nice comments and all valid concerns for small breeders. I'm feeling the burn on a number of these points, which is frustrating to say the least. When you've exhausted a lot of the advice here and still can't sell your animals, it's very hard not to simply lower the price until someone bites. I realize how detrimental that course of action is to my own brand as well as the hobby at large, but on the other side of that you are paying out electric, food, and time to care for and maintain the animals you have for sale.

[Amelydia]

Haha this is the exact thread I've been looking for, I only wish there were more replies. I'm hoping to get back into the snake hobby but I've got to convince my husband that its a good idea. I am really curious how difficult it is for small and medium sized breeders to place animals. Assuming you have 2 clutches and plan on keeping 1 hold back from each, what do you do when you end up with 10 babies you can't sell? Do you just keep trying to sell them? Skip a season until you find homes for them?

[sorraia]

Haha this is the exact thread I've been looking for, I only wish there were more replies. I'm hoping to get back into the snake hobby but I've got to convince my husband that its a good idea. I am really curious how difficult it is for small and medium sized breeders to place animals. Assuming you have 2 clutches and plan on keeping 1 hold back from each, what do you do when you end up with 10 babies you can't sell? Do you just keep trying to sell them? Skip a season until you find homes for them?

For me personally, until I buy a bigger house, I'll have to limit myself to one clutch a year, and skip seasons until all my available stock sells. That forces me to be extremely selective in what I buy, keep, and breed.

[bcr229]

Assuming you have 2 clutches and plan on keeping 1 hold back from each, what do you do when you end up with 10 babies you can't sell? Do you just keep trying to sell them? Skip a season until you find homes for them?

A hobbyist can do that. A business has to flip inventory and make some money, and make more inventory. If you're not selling then there's no point in having the hassle and associated overhead that comes with running a business.

[Marrissa]

See I was planning on making it a "business" so I don't get in trouble with taxes. I was planning on waiting until I've got more established snakes and maybe had a season or two of clutches under my belt. My first season, I should have around five females ready, and even more the next season... unless my boyfriend gets his house this year (which is the plan), in that case I get my reptile room and will be purchasing a few breeder size females. I plan on staying around 10 clutches max for a while unless I find I'm capable of caring for more babies and adults than that.

[bcr229]

See I was planning on making it a "business" so I don't get in trouble with taxes.

IANA CPA or attorney, and this is not legal or tax advice.

That said... the only real difference between a business and a hobby with respect to taxes is that your small business can report losses and you can use those losses to offset other income, while there is no deduction for hobby losses. Both business and hobby income have to be declared for taxes.

So, if you breed, buy and sell, trade, etc. and can prove that your costs for feeders, equipment and supplies, vet bills, etc. are greater than your income from sales, so you never make money each year, and keep it a hobby, and thus never deduct your losses, the IRS won't care. If you find yourself coming up to the end of the year and you've made money, 1) CONGRATULATIONS, and 2) go shopping.

If you breed and sell and never make money, operate as a business, and deduct your losses every year to offset other earned or investment income... eventually the IRS will care and may go back several years, prohibit the deductions you took for business losses, and hit you with a bill for back taxes, penalties, interest, etc.

As both a business and a hobbyist you should keep records of income and expenditures in case of a personal tax audit, especially if you accept PayPal or other forms of e-payment from buyers as those transactions are trackable.

[Nick_bp]

I am not a lawyer or business owner but my mom started a small business and is doing alright, she does make a profit. To declare taxes on the the profit you make from your small business or any type of selling for goods or services you have to hit a certain amount of profit. The IRS will only allow you to declare loss on your small business for only a certain amount of years after you hit those certain amount of years you have to either accept your losses or cut ties with your business. I do not know the exact details and this is not legal advice, just some information I have learned over the years from my mom running her own small business.

[zee-man]

I am happy to see people posting and having some back and forth in conversation.


For reference, any income over $500 / year you need to claim to remain within the law for taxes. Consider this is a "hobby" where one snake can sell for a few times that, you will most likely need to make a claim.

I am currently personally investigating what is required to have a "hobby" business as far as approvals, paperwork, etc. I do know that it varies by state and even city / borough, but once I find more information, I will relay it here.

[Snizz]

So glad to have found other like-minded individuals also at the beginning of this journey. Perhaps it goes without saying, but, I would remind people to check with their local town hall on legality, permits, limits, etc.. Some municipalities have strict restrictions such as; no constricting snakes, no snakes longer than X# of feet, no more than X# of snakes in a household, and so on. A pet owner may be able to fly under the radar in areas like this, but participating in commerce and the community as a breeder is another story. Before investing significant money, and making a name for yourself, make sure officer friendly isn't going to show up and shut you down.

[coldbloodedsouth]

This is a very helpful thread! I've kept reptiles since I was a kid and have decided to breed a couple of clutches in a year or two, and a lot of my questions about the business side of the hobby have been answered.