The Business End of Racing

A while back I was talking with one of the guys at the track and he mentioned something about starting an LLC company for racing. He said basically you can write off any expenses that go toward the sport (i.e. entry fees, trailer, parts, tow vehicle, and on and on...). Income would be prize money, contingencies, sponsorships whatever but you don't need to show a profit or even revenues for something like 5 years.

This idea interested me and I was curious if any of y'all have gone this route as far as starting a small business to support or partially defray the costs of your racing habits/addiction.

Of course, I ought to be talking with lawyers and tax accountants but want to get it from the angle of racers...

Thanks,

Chris

So.... am I to believe there are no entrepreneurial racers around? I know a bunch of you guys run shops, etc. as sole proprietors or the like (?) How 'bout you folks? Any pointers for starting a small business and what you can a can't get away with as for the tax man?

Any help appreciated as always....

Thanks,

Chris

I'll have an answer for you as soon as I have my taxes done in January. Save every receipt, no matter how small.

Yup, go see a lawyer. Depending on what all you want to do under racing name it could be an LLC or if someone is in it with you and LLP..... I keep all my receipts.....everything.....and also have the software to put it in the computer...As far as taxes, I don't try to get away with anything..... Think I'd rather face a jealous husband then an IRS auditor.... Might also want to set up a session with a tax advisor to help get things set up right LEGAL and correct the first time......

I'm certainly no expert on it, but I do have a good lawyer and a good tax man so I don't have to be an expert!!!!!!:LOL: :LOL: :LOL:

Thanks guys! Sounds like I need to start by finding a decent lawyer to guide me through the process. Any tips on finding a good lawyer? Just hit the phonebook and hope for the best?

Thanks again,

Chris

Quote:

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Originally Posted by skids72

Thanks guys! Sounds like I need to start by finding a decent lawyer to guide me through the process. Any tips on finding a good lawyer? Just hit the phonebook and hope for the best?

Thanks again,

Chris

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I guess I just got lucky, my lawyer is a hot rodder!!!! Setting up an LLC isn't real difficult, mostly just a matter of filing the right papers with the state and getting a tax and resale license, shouldn't be too tough to find a lawyer that is up to it. Might try asking around and see if your friends recomend anyone????

Jud you think you can give some pointers? I am looking to start a performance shop here in Texas

Well ... It is for a HOT ROD shop ... so indirectly ... its related right??? It's useful info for those of us that are interested in supporting our habbits ... umm I mean Hobbies .

Thanks for the reading .

Thanks, sleeper red! I'm sure the same info is available through the SOS office here in Colorado. I guess rather than worrying about how to do it I should just do it. Handling the taxes is the part I worry about the most but I'm sure if I pick up a quick books and or turbo tax or similar for small business, it should be rather painless....

Best of luck to everyone...

Chris

Thanks, Jud for all the info... I'll try to get things set up soon. I've been putting off some purchases till I get it all figured out.

Fortunately, I won't have to worry about employees as it's just me and the boss (wife) and she usually works for "free" ;)

Chris