Are You Ready? Personal Prep for Season
 

Like all officials my preparation of the upcoming season includes registrations, exams, clinics, and updating/blocking my arbiter; however, there are a host of other things that I must do in order to be thoroughly prepared. Here is a list of additional things I do, do any of you'all do the same or different or additional preparatory actions?

1. notify/remind my daytime job Employer that the hoop season is starting soon and I have afternoon games scheduled---so I notify them that I must leave work 1.5 hours earlier on those days--and that I will be coming in 1.5 hrs earlier to comp out my 40 hr work week.

2. vehicle prep--get my oil changed, maybe a tune up, vacuum clean my car, and tires all checked becasue I'll be doing lots of driving around to various game sites.

3. collect lots of coupons from the Sunday newspaper for discounts on various fast food (the usual places)--so I can get proper discounts on all the pre-game meals that I eat while driving to the game site.

4. get a folder for all the reciepts from gas, food, uniform items so that my deductions for taxes are organized and documented.

This is just me...

Do you not just take the mileage deduction? Or do you use that car strictly for officiating and document all expenses related to the car?

Note that you can't legally deduct the gas AND take the mileage deduction.

*well mostly I use the standard deduction for mileage; but i like to keep track of my expenditure for gas when I'm on reffing missions--mainly to track my personal efficiency.
I must say that it was surprising to find that none of you guys /gals take advantage of the pre-game meals discounts available?! Or maybe someone just has not posted on it yet.

I don't believe food is a deductible expense unless it is "necessary for you to stop for substantial sleep or rest to properly perform your duties" or it is business-related entertainment.

Does going to the "business-related entertainment" club after the game count?? ;)

We arrive about 6:15PM for varsity games. I eat a late lunch and light dinner after the game. I don't ref after eating a meal.

Kansas Ref is about to get audited. :)

I was told it OK if it was on the way or part of what you normally do as apart of that job. Again, this might be something you really need to check with your CPA or Tax professional. They usually can clarify how you do many of these deductions.

Peace

I'm amazed at how many officials in my area are bothered when they are asked to fill out a W9....or worse, when they are paid by Direct Deposit.

My response is always of the nature of....."Why does it matter since all offciiating income is taxable?" I smile when I say this, since I know the only reason people care is cause they feel that this alone means they have to pay taxes.

I think you're generally correct, but I know of a few people that are uncomfortable putting their social security number on multiple forms and leaving them in pile in a coaches office...

Are there still rules about a "business" having to show a profit once every few years or the activity being considered a hobby? I am not a CPA...my son is...but have not asked.

Most of the officials I know only declare income reported to them on a 1099. Around here, schools and/or districts pay directly to the individual and with the high number of school districts and private schools in the area (a large metropolitan area) virtually nobody is paid enough by a single entity to reach the 1099 mark.

Years ago I got a tax ID and tracked all the income and expenses for two years. The first year I finished in the red by about $100...the second year I finished in the black by less than that. That is when I stopped tracking everything.

Years ago, I tracked every automotive expense that would be taxable under the actual expenses deduction for both of our cars because there were times I used my car and times when I used my "better half's" car. Unless you are replacing the transmission in every month that has 30 days; replacing the engine in every month that has 31 days; and replacing the tie-rods and brakes in the month that has 28 or 29 days, one's actual expenses cannot come close to the Federal mileage deduction.

For the year that I traced my expenses, my actual expenses came out to be only 55% of the Federal mileage deduction. You cannot beat the mileage deduction.

MTD, Sr.

I have an issue with some of this because it delays the process to get paid. I do not care that I have to fill out paperwork, but we us Arbiter which already has all that information they basically need but a signature. I really do not care about filling out paperwork, but it seems that many schools do not review it.

I have had schools not only not pay attention to the information I filled out on a voucher, they sent to the wrong address or call me to find out what was the right address. Again, everything we have is on Arbiter. And in the case of an IHSA official, all our address information is also on their website.

Last year just to get paid at one of the schools, we had to fill out an online voucher that did not get processed properly. And mostly, who is reviewing this information? I am giving you my social security number and I have no idea who sees or can review the information. Because when we sign this information, we are not giving it to the people in the business office. We are giving the information to some "host" who may or may not be a teacher or even administrator and they could do a lot with that information and we would not know.

Peace

I have a very good friend who is a lawyer that deals in these kinds of things and he says you can lose money and still be OK. Again, that might apply to my state and surrounding states, your state might be different.

Peace

The rules state that your business is to have a profit 2 out of every 5 years.

BUT!! In 1996 at the ABL officials tryout camp in Atlanta, I officiated 4 games with a fellow college official who was also an IRS agent from Washington, DC. I asked him about that rule. He said not to worry about it.

Before invoking that rule, the IRS looks at the type of business and his expenses, and the amount of gross revenue that it generates. His example was a person who is a stamp collector and who buys and sell stamps as a "hobby". If this person, on his Schedule C shows $15,000 in expenses (airplane travel expenses rather than automobile expenses) and only $500 in gross revenue every year, he will be subject to the requirement of a profit 2 out of every 5 years. But someone who officiates H.S. and small college athletics whose travel expenses are almost 100% automobile mileage deductions will get a pass if they lose money year after year because it is acknowledged that the mileage can easily wipe out actual gross revenue or come very close to wiping it out.

I can't remember the last time I had a taxable profit from officiating and umpiring, and I declare every penny I make (including game fees that are paid in cash) and only take legal deductions. If you don't have a taxable loss every year, you are not trying, :p.

And while I still have a taxable loss I still have a non-taxable profit, just like the multi-national corporations. Isn't America great!

MTD, Sr.

I seem to run a small profit every year. I'm only deducting the basics such as registration fees, clinic fees, mileage, tolls, uniforms and equipment. I don't mess with meals, laundry, portions of my cell phone bill, internet, etc. I figure if I only do the basics I'm less likely to get audited and a few hundred dollars profit doesn't have much, if any, impact on my final tax bill.

It drives me INSANE to do my part in every aspect, including legibly filling out a voucher and W9, both with current address, to then have to track down a check 6 weeks later because the address the school has on file is the old house from four years ago. Happens at least 2-3 times per year between the two sports


I wish I had a cool signature

Oh my dear Welpe.

Meals: Do you and your partners stop for dinner after your game and have a post-game discussion about the game? If you do, that meal if 50% deductible.

Laundry: To to a laundromat and see how much it costs you to keep your officiating uniforms clean. To keep that sharp crease in my officiating and umpiring pants, nothing is better that having them dry cleaned a couple of times a season, especially umpiring pants.

Thanks to cell phones my long distance phone bill is now zero, and my postage is next to nothing because of the internet.

If you and share ownership of your car with a bank (and aren't we all making car payments) the interest on the car loan is deductible (prorated of course based upon your officiating mileage and your total mileage). The IRS agent I officiated with told me about this deduction. The mileage deduction does not cover the interest paid on your car loan.

MTD, Sr.

I'm guessing that if you also included the cost of buying the car somehow, you'd come to that amount. There is plenty of fleet data out that that documents the cost of driving and when all costs are considered, it is often greater than the federal allowance, depending on the specific model. Older cars typically cost less than new cars.

It was explained to me that the federal allowance takes into account depreciation. Don't ask me how, just that it is supposed to take it into account. But the federal allowance is still a good deal.

MTD, Sr.

Sounds like we know some of the same people.

The allowance is a good deal much of the time. It is certain far easier than the alternative. The alternative could be better for someone who is self-employed such that they use the care almost exclusively for business where all of the costs would be a business deduction.

And the allowance does include depreciation, but no two cars depreciate the same. A person who drives an expensive gas guzzling car, if they tracked all expenses including depreciation, would easily be able to beat the allowance while someone who drives an inexpensive and efficient car would do better with the allowance.

As my prep I'm actually reading the rulebook this year instead of just reading situations on here to find out the rules. :D

In all seriousness I am reading the book from front to back which I haven't done in a couple years. It's amazing the little stuff you find!

I have two state licenses for my real job. An income tax violation can result in a revocation of both of those licenses. I can't remember the last time I did not have a profit from officiating and I claim everything appropriate. However, I work varsity only and the paychecks are higher than B squad and the travel is the same.

I will continue to pay my income taxes and be glad that I have been able to officiate for over 30 years and still think its a good gig.

Here is the answer to your question. This is from the 2014 version of Publication 535:

"Presumption of profit. An activity is presumed carried on for profit if it produced a profit in at least 3 of the last 5 tax years, including the current year. The activity must be substantially the same for each year within this period. You have a profit when the gross income from an activity exceeds the deductions.

"If a taxpayer dies before the end of the 5-year period, the "test" period ends on the date of the taxpayer's death.

"If your business passes this 3-years of profit test, the IRS will presume it is carried on for profit. This means the limits discussed here will not apply. You can take all your business deductions from the activity, even for the years that you have a loss. You can rely on this presumption unless the IRS later shows it to be invalid."

So, basically, if you pass this test, then in years when you show a loss, you can take that loss against other income. Otherwise, your deductions are limited to the amount of income you produce.

I should also point out, as have others in this thread, that ALL INCOME is taxable, NOT JUST THAT WHICH IS REPORTED TO YOU ON A 1099.

I think Battery Powered is due for an audit.

Per my previous post, it is actually 3 out of 5 years, not 2. Maybe it was 2 way back in 1996. Who knows.

I also don't like your stamp collecting example, as items such as stamps, coins, etc. are subject to capital gains rules and are reported in Schedule D, not E.

I also take issue with your statement that "The rules state that your business is to have a profit 2 out of every 5 years." The IRS can't tell you how often you HAVE To have a profit. All they can tell you is how often you have to have a profit IN ORDER TO BE ALLOWED TO DEDUCT YOUR LOSSES. Maybe I'm splitting hairs here and that is what you meant. And again I point out, the current rule is 3 out of 5 years.

When I said 2 out of 5 years I meant 3 out of 5 years. I am getting senile in my old age and probably was thinking of a loss 2 years out of every 5 years. And the stamp collector example was the example the IRS agent with whom I was officiating gave, not me.

MTD, Sr.

I don't understand how I could not show a profit. In 2014 I brought in $5725.80 and drove 4300 miles. I think I have $55 to the state and $75 to my association. Uniforms purchases and shoes came out to around $200. What am I missing?

You either make a lot of money per game (relatively speaking) or your games/meetings/etc. are really close to your home.

Close to home? He drove 4300 miles to make $5,700. If I'm not mistaken, that's 133 miles driven for every $100 earned. That doesn't sound like "close to home" to me.

I'm with you on this. I have shown a pretty good profit every year.

I had revenue of about $21,000 in 2014 and mileage of about 11,000. Took all (I think) the other expenses I was entitled to. I don't go making stuff up just to increase my expenses.

We pretty much do two games every time. 2 jh was $90, jv varsity $100, Var and var $110 plus mileage. I would say average game was 100ish miles round trip. However there is some nights where I would ride with someone else and get no mileage.

I go to 3 camps every off-season, one of them is 300 miles away. That will eat into profits.

And that explains the difference....do 1 game assignments and your income drops but the mileage doesn't and you get into the break-even or loss range if you have a few extra expenses. The only common doubles we do are JH games and we don't get $90 for the pair, more like $65.

I have typically made some money in most years but have lost in a few when I've bought uniform stuff AND gone to camps.

That makes sense. I was wondering how I could even be close to it but If I cut income nearly in half I can see the possibility.

I'm in the same boat as Jeremy (And the same state). We nearly always work two games a night and I always show a pretty good profit. Once I whittle it down with mileage, uniforms, etc it is less sizeable, but I have shown a profit every year I have officiated.

Let me add a few:

a) I usually take a month and half off from officiating to recharge mental and physical batteries.
b) I participate on our Board's Education Committee to train new officials. This gets me back into the rule book in earnest.
c) Fortunate to work fall varsity schedules to get back in shape.
d) My annual physical is scheduled in December in anticipation for the season.
e) Review equipment and uniforms for wear and tear. Usually order 6 new whistles per year and purchase new apparel as needed.
f) Review/update my varsity game bag and accessories. Extra everything in case needed at game site. i.e. shoe laces, sewing kit, ankle braces, knee braces, sports tape, shoe polish, grooming toiletries (shampoo, soap, lotion, tooth brush/paste, brush, towel), flip flops, static cling spray, lint roller, wooden hangar, laundry bag for wet uniform, shoe trees, pen/paper, muscle lotion, pain reliever (lots), Tums/Pepto, cough drops, contacts/glasses case, court chart w/magnets, safety pins, small lock, swiss army pocket knife)
g) Contact partners at least one week before game to confirm. Confirm gym location and time allotted to arrive.
h) Update personal spreadsheet with game schedule; partner ratings; game notes; paid date; commissioner fee. Update file of school's coaching staffs w/pictures as needed.
i) Review "You make the ruling" videos
j) Update Pregame Meeting sheets
k) Water bottles
l) Attend game dressed at least in business casual. Look sharp; officiate sharp. Arrive early enough minimally to watch JV game.

Tastes Great, Less Filling ...
 

Wow. Are you a "whistle chewer"?

I use the Fox 40 Classic with CMG and hate when the CMG gets nasty. So, I guess, yes, I'm a whistle chewer. LOL :D