Originally Posted by Racin4Fun:
I am confused. I hope someone can help me.....wouldnt the point money be for the 2007 season...and if so it should be added to the 1099 I just received....????.........because the winnings I took in match my 1099....so I find it hard to believe that DA would not put that as a write off....but there is a chance I am wrong. I am the owner, driver and mechanic so I KNOW MY TAX INFORMATION WAS CORRECT.....To clear up a few other things...since I spent my time and money at LPS last year and witnessed first hand how things went down...and after being told my check would be WITH my 1099 I feel I reserve the right (as a man not hiding behind a screen name) to cry, whine, swear, and speak my mind about the facts I witnessed and was told. I have never said I would never race at LPS again. I just wish like many others that it was ran and the racers and fans were respected like they are everywhere else in the state.(Gas City-Bloomington-Lawrenceburg-Paragon-Kokomo) Thats not asking to much....
Robbie Rice
The way I understand what you said, the 1099 you have already received includes the weekly purses collected and NOT what is owed to you from the points payout.
From the US Tax Code
http://fourmilab.ch/ustax/www/t26-A-1-E-II-B-451.html
Sec. 451. General rule for taxable year of inclusion
TITLE 26, Subtitle A, CHAPTER 1, Subchapter E, PART II, Subpart B, Sec. 451.
STATUTE
(a) General rule
The amount of any item of gross income shall be included in the gross income for the taxable year in which received by the taxpayer, unless, under the method of accounting used in computing taxable income, such amount is to be properly accounted for as of a different period.
This is the Cash Method of accounting for revenue and it is one of the 4 methods allowed. See Section (c)
http://fourmilab.ch/uscode/26usc/www...-II-A-446.html.
Most individuals use this cash method of accounting. Basically its taxpayers simply report items of income in the year in which they are received,
not earned.
Example: Person X mails you a check December 26th 2007 for services performed but you do not receive the check until January 2008. The income is recognized in 2008 under the cash method.
-So if you do receive point fund money in 2008, even if it was earned in 2007, it will be included in 2008 income.
***Now if your race team is accounted for as a business things may be different as there are many more variables and different accounting methods are more likely to be used. I'm not a CPA, or atleast not yet. Plus I hate studying taxes. LOL