chicagocpa wrote:The clothing, unlike a house, was purchased specifically for the blog and not for personal use (though she does wear a few pieces on the weekends, which wouldn't be deducted). Clothing sponsors pay bloggers based on the number of followers they have - so you can't just buy anything - you have to buy things that people will read about and the things you're getting paid to write about. The more followers you have the more you get paid; there are events and advertising specifically to getting followers. So, it might not appear to be a legitimate way to make money but people earn livings doing this.
@chicagocpa - I work with a lot of bloggers - I would say that with the income limited to 2k, it doesn't seem right to be able to deduct the 50k in clothing. Did this all happen within 1 tax year or 2? While some of these bloggers to make enough money to make people's heads spin, I think with this particular case, she went over the top too fast. I suggest pushing her to sell these clothing items on Poshmark or something, so at least it's not a total loss.
chicagocpa wrote:She created an LLC just for this purpose - so there was a legal entity that is being liquidated.
ATSMAN wrote:I stay away from so called Bloggers as a business client because most of the time when you apply the rules it turns out to be a hobby. Couple of years back I had a lady who was Blogging about "alternative relationships" and wanted to deduct 10 times travel expenses compared to her income from the business. She had the receipts for air fare. hotel, food etc to exotic places I recall.
Feel free to send them my way ^^^
Unfortunately, a lot of the older crowd doesn't and probably won't ever understand where the economy is going.