"Jewelry" Party Plan

[neilbrink]

Has anyone had any experience working with clients that sell jewelry through the party plan?

A New client came in a few days ago with her box of receipts and a 1099 for $11,000 for selling jewelry as a side job in 2007. She said her supervisor advised her to keep all of her receipts, so she had receipts for merchandise, brochures, etc from the company and a mess of gas receipts.

She had bought several pieces of jewelry which she wears during her parties for demonstration purposes. It is jewelry that cannot be sold (buyers purchase the jewelry from the catalogue), but she can gift it if she wants. Otherwise, the jewelry is hers. She thinks the cost of the jewelry should be expensed. I was not sure if that was correct. My first thought was that it should be kept as inventory. Does anyone have an opinion on that? (She also was told by her supervisor that the costs of "tanning" and "nail jobs" to look good for the parties could be expensed. I explained the IRS position on not being able to expense those items).

She had no mileage records, but could reconstruct them from the appointment calander she kept. She also used a room at her house exclusively for her business. So I sent her away to gather the information she needed and to add up the receipts she had and bring back to me to complete her returns. Altogether, I spent about 1 hour of my time giving her a basic business 101 class.

The next day she called back and wanted to pick up her other forms that she had left with me. She said she had talked to her supervisor and her supervisor advised her to take her business to her (the supervisor's) tax practitioner. She said they would not put her through all that hassle.

Does anyone know of a website that can refer me to cites that have arisen from individuals attempting to take personal expenses (tanning, etc.)?

Thanks. (by the way, how can I get this print to be larger?)

[JohnH]

You may as well forget this client - it sounds as though she is going to go to the person who will say she can deduct the most, regardless of whether it's legal. The "tax benefits" are one way these party plan promoters try to obscure the fact that very few people make any money doing this sort of stuff.

But if she does come back, you should continue to insist that she can't deduct her tanning sessions or her manicures. You should also be prepoared to tell her that she can't deduct pet food and vet bills for her "security cat", no matter how much she insists that the cat guards her inventory when she's away from home. Don't laugh too quickly - sooner or later the party plan supervisor will probably bring this one up.

[jainen]

>>how can I get this print to be larger?<<

Move closer to your monitor.

[zeke]

:lol: I NEEDED THAT!!

[Bart]

Don't laugh too quickly

Too late. I was already laughing by the time I read that.

[Julie]

http://www.irs.gov/businesses/small/articl...=109807,00.html

Here's a start. But if she really wants to go to someone who won't put her through all that hassle, I would be tempted to cheerfully say, as she's on her way out the door, "Let me know how the audit goes."

If that doesn't make her stop in her tracks and ask questions, nothing will.

As for the question I can actually answer:

In Firefox, it's Ctrl+

In IE, it's View (on the top menu)....->Text size ..->pick the size you want.

That's one reason I like Firefox.

Has anyone had any experience working with clients that sell jewelry through the party plan?

<clipped for length>

Thanks. (by the way, how can I get this print to be larger?)

[joanmcq]

Mine is on 'largest' (my cat thoughtfully did that for me one day, speaking of possible writeoffs, can my cat be my computer expert?) but on this website, the fonts are still small.