Breeding and the IRS
Hey, for those of you who are more experienced breeders, how do you handle your taxes? I'm just now starting to get into investment-quality BPs; they are still babies and I have maybe three years to prepare for the business side of things.
How are animals (specifically BPs you plan on breeding) reviewed with respect to US federal tax laws? What about the hatchlings you sell? What are some expenses you have for breeding that are legitimate?
Someone told me that a dog breeder they knew got audited every year because breeding isn't "a legitimate business" according to the IRS. Is that still true? Do you guys get audited often?
Do you run your breeding as a business, or as a hobby in your tax filing?
Any help is greatly appreciated. I want to do this by the books.
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