Firearms related purchases and tax returns

[MCMXI]

I've worked in the firearms industry for the last three years but this is the first year I'm considering taking a tax deduction on all firearm related purchases. That would include rifles, suppressors, handguns, ammunition, optics, hunting, accessories and so on. My accountant says that I can legitimately claim these items since they directly relate to my job but is there a downside?

 

[HexHead]

... but is there a downside?

Yeah, an audit. Whether or not you can legitimately deduct those items is directly related to what you do in the firearms business. Where you thinking of doing a Schedule C for being self employed, or a "non-reimbursed employee expense"?

 

[SunnySlopes]

What's your job? Are these things that you use outside your job as well?

The IRS has some pretty strict rules of application for such things. You'd likely better check with them instead of an anonymous internet forum.

 

[JohnBT]

Which of the items listed by the OP is REQUIRED by the employer. Or even minimally necessary to DO THE JOB?

Probably none. Call and schedule your audit now, avoid the rush.

www.irs.gov/pub/irs-pdf/i1040sca.pdf

See page A-11 for Line 21 info.

 

[dogtown tom]

1858 I've worked in the firearms industry for the last three years but this is the first year I'm considering taking a tax deduction on all firearm related purchases. That would include rifles, suppressors, handguns, ammunition, optics, hunting, accessories and so on. My accountant says that I can legitimately claim these items since they directly relate to my job but is there a downside?

1. Why are you asking the internet if there's a downside?.......why not ask your accountant? You don't mention if you are a self employed filing a return or if your are an employee of a business.
2. Just because you've "worked in the firearms industry" doesn't have anything to do with claiming firearms, etc as a deduction.
3. Read this:http://taxes.about.com/od/Deductions/a/Unreimbursed-Employee-Business-Expenses.htm

1. Eligibility for the Employee Business Expense Deduction
Employees can deduct business expenses they paid for as long as those expenses are ordinary and necessary for their job as an employee. "You can deduct only unreimbursed employee expenses that are: •"Paid or incurred during your tax year,
•"For carrying on your trade or business of being an employee, and
•"Ordinary and necessary.
"An expense is ordinary if it is common and accepted in your trade, business, or profession. An expense is necessary if it is appropriate and helpful to your business." (Publication 529)

In short, if you use the item you are claiming as a deduction it must be directly related to your job.....and not reimbursed by your employer.

Example 1: If you are a machinist for Remington, and required to supply your own tools and protective equipment.....you can claim a deduction.

Example 2: If you are a salesman for Remington and as part of your job you do shooting demonstrations with company provided firearms and ammunition....you cannot deduct anything.

Example 3: If you are self employed as a gunsmith and buy ammunition to check function, accuracy, etc on guns you are repairing or customizing, the ammunition you actually use in the course of business is deductible. Personal use is not. You can't buy a pallet of ammunition, use one case for work related stuff, the rest you plink with and claim the cost of the entire pallet as a deduction.

 

[MCMXI]

1. Why are you asking the internet if there's a downside?.......why not ask your accountant?

Because there's a lot more collective experience here regarding firearms compared to my accountant's office. I'm sure others have deducted similar expenses. My accountant simply asked me to provide a list of items and cost and said nothing about what does or does not qualify.

Line 21
Unreimbursed Employee Expenses

An ordinary expense is one that is common and accepted in your field of trade, business, or profession. A necessary expense is one that is helpful and appropriate for your business. An expense does not have to be required to be considered necessary.

HexHead, the bolded text seems to be open to interpetation.

Which of the items listed by the OP is REQUIRED by the employer.

See bold text above.

 

[vamo]

If you are actually using them in your job then you might have a case. As in your a traveling salesperson and use your personal collection as demo models, is an example that comes to mind. If you're an office worker or work in the machine shop and your personal collection is just your personal collection and never gets used when you're working then its probably a stretch and could get you tax trouble.

I think somebody would need to know you're actual job duties to tell you for sure if you could claim your personal collection. That's something your accountant knows and could very well be advising you correctly.

If by downside you meant you get put in some special government file, well you own suppressors so you're already in some special government file . But no its not going to be a backdoor registry.

 

[vamo]

Personal versus Business Expenses

Generally, you cannot deduct personal, living, or family expenses. However, if you have an expense for something that is used partly for business and partly for personal purposes, divide the total cost between the business and personal parts. You can deduct the business part.

For example, if you borrow money and use 70% of it for business and the other 30% for a family vacation, you generally can deduct 70% of the interest as a business expense. The remaining 30% is personal interest and generally is not deductible. See chapter 4 for information on deducting interest and the allocation rules.

From the IRS website. They use a loan as an example, but it probably extends to items.

 

[slumlord44]

When in doubt, I take the deduction. I am always prepared to defend that choice in an audit. Never been audited in 50+ years. Worse case situation if audited and it is denied you pay the tax plus interest and possibly a penalty. They usually only hit you for one year, but could go back several. They want your money, they do not want to put you in jail. They do not have the manpower to audit everyone. If they ever audit me and I have to pay, I will write the check and walk away knowing that I am still way ahead of them.

 

[JohnBT]

God I love how people skip over a sentence to cherrypick the next one they like. Read the one you didn't BOLD.

"An ordinary expense is one that is common and accepted in your field of trade, business, or profession."

There's no dodging that one. I haven't heard of folks in the biz taking the deductions for all their personal stuff. You'd think the word be out by now if it was legal.


" My accountant says that I can legitimately claim these items since they directly relate to my job "

How do they directly relate? That's what the audit will be about. Do you use your guns to take customers to the range to sell your company's ammo/clays/wads/etc?

 

[Blackbeard]

It'll depend on what exactly your job is. If you're a guy who assembles AR-15s, I doubt you can claim that your 1911 and its ammo are "necessary" for your job. A guy who sells cars for a living can't deduct his own car. It's not necessary for his job.