Do most breeders incorporate for tax purposes? Would having an LLC or S-Corp for your hobby/business seem too businesslike? Just looking for some guidance on what most of you do.

TIA!

My accountant doesnt recommend a corp for me. We do our taxes as a individual. Why would you think about creating a corporation?

I've just seen a few breeders who have created LLCs for themselves and wondered if this was common and/or important? Is it a legal issue so you don't get sued personally? Again, just wondering...

Perhaps it is a good idea to call the breeders who are LLC'd and introduce yourself and ask them personally.

Also, you should speak with your personal/business Attorney and Accountant and see what is best for your situation as everyone's business is different... be it a hobby kennel or Boarding Kennel/breeding facility

With an S Corp. if you get sued they can only sue the corporation and go after the assests that the corporation owns. If not an S Corp. you can get sued personally and then they can go after all of your personal property, house, personal bank accounts, and the rest of it. An S Corp. is a safe idea for these reasons. On the other hand, you will be treated and taxed as a corporation. You might consider the amount of income you are making to determine your final decision on which is best for you.

Not entirely true. I have an LLC. Did so to separate myself from the liability of the dogs, so that I don't lose everything in this litigous world.

But if you don't make a profit (which most of us don't!), does the IRS look kindly upon a money-losing LLC? Do you just take a loss year-after-year?

Let's be realistic . . not every year of breeding is a "losing" year. You have to have enough stud services, puppies, expenses etc to report during your tax year. There are times in which you have several years with a loss. The key is to report accurately (documented). If all you are showing is all your expense then you don't have enough supporting documentation to run as a business. After many years of constant losses the IRS will catch up with you and call you on your reporting. See a tax adviser and a small business attorney for specific answers on how to do taxes and incorporate as an LLC. Also, many state websites have good info on their economic growth pages.

I have tryed and used the dogs as "small business" twice over many years. You just do not make money. Or I did not having a litter or two at the most a year. You can only do it for 5 years where we live without showing a profit. After that they will tag you for using it as a write off. And when you save every receipt, gas bills, breeding bills, showing, food, you get sick. Better not to know how much we spend.