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Old 12-28-2015, 04:46 AM   #21
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I think it is a hard way to make money, but it can be done. I am more like Car Guy, i do it for my older cars because i like them and it's my hobby. I generally can buy, do some repairs, drive for a while and then sell for at least the costs of not some profit. I would never rely on this as real needed income though. I also have a small home-based small business where I sell some parts for old cars. It is mostly for tax write-off, I certainly won't be retiring any sooner or different plans because of it.
Could you elaborate on how you use it as a tax write off? What type of stuff can you write off? By write off its just reducing the amount of taxes you pay on your profits right?

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"flipping vehicles as a hustle"

My first read of that headline had me thinking you were staging accidents and scamming people. Guess not...
Yeah I'm definitely not trying to do that.

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Before I sold my lake house, I enjoyed buying/selling boats for a bit of extra cash. I would only buy boats that I wanted to use and that were also good deals. I would typically keep/use a boat for 1-3 months before selling for a profit. I have also done this with a couple of RVs -- used each one for 6 months or so (and put around 10k miles on them), then sold for a profit of a few thousand bucks. I enjoy buying/selling but with the twist of enjoying the boat/RV for a while.
I dabble in RV's and boats as well. Sometimes trailers and fourwheelers, heck even lawnmowers if I can find them cheap that need a little work.
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Old 12-28-2015, 02:47 PM   #22
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For those of you that flip cars - don't you need a license of some sort, otherwise you'd owe sales tax when you bought it, then the buyer would owe sales tax ?
It varies by state of course. IIRC in MD it was five cars in a year was okay, more than that you needed to have a dealer's license. I have no idea what it is in WV.
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Old 12-28-2015, 03:57 PM   #23
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Sounds like w*rk!

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Old 12-28-2015, 04:09 PM   #24
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Could you elaborate on how you use it as a tax write off? What type of stuff can you write off? By write off its just reducing the amount of taxes you pay on your profits right?
The net effect is a tax write-off loss, since primarily my home office deduction and secondarily mileage end up being more in total than my net profit. My net profit in a year is only $3-4K, so you can see my statement about not really affecting my retirement. Once retired I do plan to try and grow it bigger and also let the business pay for some "business travel", but right now just a very part-time home based side activity that has some nice tax help. If the moderators do not mind, this is my website for you to see, my sales are all mail order for most part. I do not have any physical store, just my home office space. HotRodLatches.com - Forget about your doors flying open! and it is mainly a way for me to help pay for some of my old car hobby expenses.
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Old 12-28-2015, 04:23 PM   #25
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Originally Posted by 38Chevy454 View Post
The net effect is a tax write-off loss, since primarily my home office deduction and secondarily mileage end up being more in total than my net profit. My net profit in a year is only $3-4K, so you can see my statement about not really affecting my retirement. Once retired I do plan to try and grow it bigger and also let the business pay for some "business travel", but right now just a very part-time home based side activity that has some nice tax help. If the moderators do not mind, this is my website for you to see, my sales are all mail order for most part. I do not have any physical store, just my home office space. HotRodLatches.com - Forget about your doors flying open! and it is mainly a way for me to help pay for some of my old car hobby expenses.
Very nice latch kits! Do you make them yourself or contract out the metalwork?
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Old 12-28-2015, 04:53 PM   #26
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Very nice latch kits! Do you make them yourself or contract out the metalwork?
Thanks for the compliment. I contract out the manufacture of the latch install kits to my design, but the latches are bought from an OEM supplier as a stock part. My business really is just the marketing, packaging and selling to the old car hobbyist. As I said, it is very low $ right now, but has some nice benefits I intend to take more advantage of once I can devote more effort and time in retirement; such as setting up sales booth at a car show and letting it be a business expense while I am enjoying being at the car show. Have fun and let Uncle Sam help pay my way.
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Old 12-28-2015, 05:25 PM   #27
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Thanks for the compliment. I contract out the manufacture of the latch install kits to my design, but the latches are bought from an OEM supplier as a stock part. My business really is just the marketing, packaging and selling to the old car hobbyist. As I said, it is very low $ right now, but has some nice benefits I intend to take more advantage of once I can devote more effort and time in retirement; such as setting up sales booth at a car show and letting it be a business expense while I am enjoying being at the car show. Have fun and let Uncle Sam help pay my way.
Sounds like a good start to a fun business. I mentioned in an earlier post that a friend of mine started selling RV parts he acquired/refurbished and that effort is expanding beyond what he thought it would.
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Old 12-28-2015, 07:56 PM   #28
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I met a Brit (actually an Aussie living in the UK) that had an eye for knowing what to pay for old cars. He found cars enough to fill a shipping container and got them to.the UK for reasonable shipping cost, and said the ones he decided not to fix would go for nearly double what he paid.

Ben was an Aussie? I had no idea. And I also had no idea that classic American cars went for so much $ over there. Very cool business, though.

We buy old cars and fix them up, but rarely do they have enough life in them to sell to anyone but the junkyard when we are done with them.
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Old 12-28-2015, 08:57 PM   #29
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Ben was an Aussie? I had no idea. And I also had no idea that classic American cars went for so much $ over there. Very cool business, though.

We buy old cars and fix them up, but rarely do they have enough life in them to sell to anyone but the junkyard when we are done with them.
The Brits love the older American cars. Remember, they have been punished for years by firms like Lucas (electrical), Morris Garages (MG), Jensen-Healey, Jaguar, etc. (some of these and other similar companies are defunct)
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Old 12-28-2015, 09:31 PM   #30
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Originally Posted by 38Chevy454 View Post
The net effect is a tax write-off loss, since primarily my home office deduction and secondarily mileage end up being more in total than my net profit. My net profit in a year is only $3-4K, so you can see my statement about not really affecting my retirement. Once retired I do plan to try and grow it bigger and also let the business pay for some "business travel", but right now just a very part-time home based side activity that has some nice tax help. If the moderators do not mind, this is my website for you to see, my sales are all mail order for most part. I do not have any physical store, just my home office space. HotRodLatches.com - Forget about your doors flying open! and it is mainly a way for me to help pay for some of my old car hobby expenses.
Nice! That's a pretty good idea. I'm staying under the state limit for now but once I retire I plan on growing my flipping business alot as I'll have more time to search out and find the deals. I always love to hear the benefits of it as far as taxes etc. For now it seems that Uncle Sam would just be taking 15% of my profit.

I have an online business sort of like you have there, except mine is geared towards Yamaha ATV's and side by sides. I'm looking to expand it eventually but the online parts business is tough unless you can come up with unique parts/ideas that fix a common problem. OEM parts are tough to sell against the big guys. Basically, I sell parts for the Yamaha 4wd system. I found a way to repair and replace a common problem part for around $50 vs $400 which is what it would normally cost. Like you I contract out the manufacturing and I market the parts on ATV forums. If I'm not out of line, here is the link if you want to check it out.
501 Parts.com Yamaha 4wd System Repair Parts & Service

I enjoy this and it's a good way to bring in a little extra money also. I sell the same parts on Ebay and Amazon. Hopefully it turns out to be a good supplement to retirement.
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Old 12-29-2015, 07:53 AM   #31
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When Weston, Ben and I ventured to the city, I learned a lot about Ben's car business. He's done some amazing stuff fixing up cars...even taking a new interior cab portion of a car and putting it on a custom performance chassis, articles in car magazines and stuff.
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Old 12-29-2015, 08:09 AM   #32
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When Weston, Ben and I ventured to the city, I learned a lot about Ben's car business. He's done some amazing stuff fixing up cars...even taking a new interior cab portion of a car and putting it on a custom performance chassis, articles in car magazines and stuff.
Yeah, he showed me some pics of his shop and I was blown away by the quality of some of those restorations. We'll be seeing him when we go over in April, I hope!
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Old 12-29-2015, 10:51 AM   #33
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Nice! That's a pretty good idea. I'm staying under the state limit for now but once I retire I plan on growing my flipping business alot as I'll have more time to search out and find the deals. I always love to hear the benefits of it as far as taxes etc. For now it seems that Uncle Sam would just be taking 15% of my profit.

I have an online business sort of like you have there, except mine is geared towards Yamaha ATV's and side by sides. I'm looking to expand it eventually but the online parts business is tough unless you can come up with unique parts/ideas that fix a common problem. OEM parts are tough to sell against the big guys. Basically, I sell parts for the Yamaha 4wd system. I found a way to repair and replace a common problem part for around $50 vs $400 which is what it would normally cost. Like you I contract out the manufacturing and I market the parts on ATV forums. If I'm not out of line, here is the link if you want to check it out.
501 Parts.com Yamaha 4wd System Repair Parts & Service

I enjoy this and it's a good way to bring in a little extra money also. I sell the same parts on Ebay and Amazon. Hopefully it turns out to be a good supplement to retirement.
You might look into the advantages of the home office, instead of being off the books below the limits. In my case I claim 100 sq ft of my 2000 sq ft house, and can take 5% of all of my house expenses. That adds up. Sure some people claim it will make you more susceptible to audit, but if you are legit, nothing to fear. Bring it on tax man, I can prove I meet the law and am legally entitle to take the deductions. Same with mileage, each trip to post office to mail stuff, or other business trips, it all adds up. I just do the std mileage deduction, not getting into all the dedicated car hassles.

As for your business, like mine it is very specialized and niche market, so neither of us is going to quit our real jobs. I find the marketing aspect the part I could do a lot better with. Once retired I will devote more time to it. It seems you have a good product with your fix to help folks out and save money. It is hard to compete against the big guys, the key is provide great service and keep overhead low so you can sell cheap. Word of mouth and referrals help me a lot. Plus my big advantage is high quality made in USA parts vs the crappy Chinese stuff my much bigger competition sells.
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Old 12-29-2015, 12:11 PM   #34
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Yeah I can see how that would add up. I have a whole room of my house dedicated to shipping/part storage not to mention the garage, so that would be something I'll look into next year once I can start selling more and get the tax situation right. I pay some of my rent now from buying/selling UTV's and vehicles so that may raise a flag. Not sure if how you actually pay your household expenses gets looked into or not if you claim the deduction.

Yep word of mouth and internet forums is how my product gets out. I looked more into your site, I like the layout of it. I'll keep in in mind. I do alot of welding/fabricating and have made doors before for UTV's. Not sure if you've looked into it, but doors, latch and hinge kits would be good seller in the UTV market. Either way it's good to have a source for quality latches.
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Old 12-29-2015, 06:39 PM   #35
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I only flipped a vehicle once. An Army jeep. Once it was upside down, crawled out of it, and marveled at the fact that only some spit shine was missing on the toes of my jump boots, then thanked providence and all the various deities for keepin me alive and scratch free.

Otherwise just buy and hold until no longer repairable.
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Old 12-29-2015, 07:51 PM   #36
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Lots of folks here have rental real estate during FIRE. May not be called a "hobby", but it takes skill and time like a hobby.

Also, hobbies sometimes turn into income producing ventures, even when not initiated with that purpose.
I don't know that I'd put real estate rentals into the same category as an income producing hobby. Hard to believe that anyone likes the work involved in renting real estate other than cashing checks, but the OP seems to enjoy working on cars. "Skill and time" is not the definition of a hobby. Not even close, so I wouldn't use that as any kind of guide to compare to a hobby. Enjoyment and passion is well ahead of those two factors. As W2R says, if you'd still do it without making money (or at least only a bit), it's a hobby. I also think that real estate is very different because it ties up a significant amount of capital that most hobbies do not.

It sounds like there are more than a few people who can at least cover the costs of their hobby if not make money from their hobbies, but I wouldn't say "most of us" do that. I think many, including me, just have our investments and collect our pensions and social security and the like. There is a contingent that supplement to some degree, and some amount of work, with real estate rentals. And there are a few that have found a hobby that can make income, but it sounds to me that many are just happy to break even rather than having a "side hustle". Good for anyone that can do that. I just don't think it's too many. But I do enjoy seeing what kinds of things they do and how they go about it. Good thread.

I do know a couple local retirees who enjoy skiing and teach or work on the ski patrol, which gets them some extra income. A few people have suggested that I should do that since I'm out on the slopes anyway, so I could get paid for it. But even though they may enjoy the work at times I hear them bitch about having to work a busy weekend, or deal with a difficult student, or deal with the head of ski schools or ski patrol and their rules, and I see it as a job. Not the worst job, but a job nonetheless. I especially enjoy a powder day when I can ski whenever and wherever I want and skiing by them locked into doing their job. Or bailing out on a bad weather day and seeing them stuck out there.
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