In January of this year I decided to try and turn my hobby into a small business. I buy and sell antiques, collectible, vintage gun parts etc...I sell online, at flea markets and at shows. I also work a full time job. I have not applied for a business license as I want to see the feasibility of doing this. I currently use a book keeping program that automatically tracks all Ebay and PayPal transactions. So the online part is pretty cut and dried. I can also add any expenses and sales to this program manually. My questions come into play when doing shows or making large bulk purchases. This scenario happened two weeks ago.
I traveled to Ohio and purchased a large collection of gun parts, sporting goods etc...I paid $3000 for the entire lot and I have a receipt showing that I paid that amount. Since there were literally thousands of small parts included it would be virtually impossible to inventory every single piece. What is the proper way to list what I bought to tie it to the $3000 receipt to make the tax man happy? Do I give a total number of boxes with an overview of whats in each box and assign a cost to it to get to the $3000? I listed all my expenses involved with the trip and have receipts for hotel, rental truck, fuel, food etc.. I assume I can use these.
This scenario plays itself over and over. If I set up at a show, a person may bring me a large boxfull of whatever. I pay him, write out a receipt as to what I paid and log a general overview of what I purchased.
I'm not trying to cheat the taxman and my intent is to make profit and pay the taxes due. I just want to be sure I'm handling these bulk transactions properly. All input is certainly appreciated.
I traveled to Ohio and purchased a large collection of gun parts, sporting goods etc...I paid $3000 for the entire lot and I have a receipt showing that I paid that amount. Since there were literally thousands of small parts included it would be virtually impossible to inventory every single piece. What is the proper way to list what I bought to tie it to the $3000 receipt to make the tax man happy? Do I give a total number of boxes with an overview of whats in each box and assign a cost to it to get to the $3000? I listed all my expenses involved with the trip and have receipts for hotel, rental truck, fuel, food etc.. I assume I can use these.
This scenario plays itself over and over. If I set up at a show, a person may bring me a large boxfull of whatever. I pay him, write out a receipt as to what I paid and log a general overview of what I purchased.
I'm not trying to cheat the taxman and my intent is to make profit and pay the taxes due. I just want to be sure I'm handling these bulk transactions properly. All input is certainly appreciated.
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