bfiedler Posted September 30, 2014 Report Share Posted September 30, 2014 I do not have enough discretionary money to buy tools as I need or want them, and the other day I had the idea of selling simple projects to fund my hobby. I don't want to become a full time woodworker, but do want to have cool tools. The project is a simple planter, costs $50 in materials, and I've had quite a few people offer to buy them for $100. I can crank 3 out in a day. Would you consider building simple projects to sell, so that you can buy more for the shop? I don't want all my time spent making these planters, but it's a way to get paid to use wood, and fund more bigger projects. Quote Link to comment Share on other sites More sharing options...
bfiedler Posted September 30, 2014 Author Report Share Posted September 30, 2014 So at first is as upset I didn't get a reply... Then I actually dug around, and realized three posts down was my exact question... So I change my question. Now it is; what is the best tool to remove a foot from a mouth? Ha! Quote Link to comment Share on other sites More sharing options...
wtnhighlander Posted September 30, 2014 Report Share Posted September 30, 2014 Well, I just saw your post, so I'll offer an answer. Anytime I could sell a project for twice the cost of materials, and be able to produce 3 a day, I'd go for it. That should build your tools fund rather quickly, and open the door to future projects and commissions. Quote Link to comment Share on other sites More sharing options...
bfiedler Posted September 30, 2014 Author Report Share Posted September 30, 2014 Well, I just saw your post, so I'll offer an answer. Anytime I could sell a project for twice the cost of materials, and be able to produce 3 a day, I'd go for it. That should build your tools fund rather quickly, and open the door to future projects and commissions. I can always count on you to reply, even when its me being dumb! HA! My work is weird, and I can have 2 weeks straight at home, so I figured I could make some extra cash easily, making projects like these. I can't say that they are a shining example of fine woodworking, but they are nice, and at a decent price point. Thanks for the reply! Quote Link to comment Share on other sites More sharing options...
Beechwood Chip Posted September 30, 2014 Report Share Posted September 30, 2014 Another thing that I haven't seen discussed here... In the US you can deduct business expenses from your income when doing taxes. I have a few friends who make just enough money from side jobs or selling apps that they can deduct the cost of their computers, home office, etc. You need to talk to an accountant to find out the rules, and do some additional bookkeeping, though. Quote Link to comment Share on other sites More sharing options...
T-astragal Posted September 30, 2014 Report Share Posted September 30, 2014 I say keep your hobby a hobby and deal in cash. Not to defraud the IRS, don't get me wrong. But look, you are going to spend more than you make, probably at least. There is no way to write it off if its a loss every year anyway. So cash in, cash out baby. Head aches of keeping up with petty income and expenses won't help you enjoy the work. Now if you start making money and expect that to be normal, go get some help with an accountant and set up books. Early in my career I did just that; bought tools with proceeds of selling a few projects. At the point that I went pro, it became advantageous to keep records and take advantage of expensing all costs. 2 Quote Link to comment Share on other sites More sharing options...
mikem Posted October 1, 2014 Report Share Posted October 1, 2014 Be careful about the tax aspect of this here. If your business is classified as a hobby business, you are actually very limited to what you are able to deduct. 1 Quote Link to comment Share on other sites More sharing options...
Popular Post T-astragal Posted October 2, 2014 Popular Post Report Share Posted October 2, 2014 If a business actually makes money it's a business. A business that repeatedly loses or breaks even is a hobby. You can only deduct expenses to the point of loss for so long before the tax man wants it back. So you end up paying taxes on all the expenses you deducted all those years. What I'm saying is enjoy your hobby. Use the proceeds of any sale to fund your hobby. That's what makes you happy and keeps the wife smiling too. In the end you may lose a buck or make a buck. Petty cash. If you want to start a business, get the hobby out of your head. It's not that simple. Sooner or later those "deductions" become actual cash outlays that leaves you cash poor. It's not easy to run a business when most of your revenue goes to deductions. I turned my hobby into a business in 1999. Guess what? I have a new hobby now. My woodworking passion is now largely design, sales, installation, purchasing, repair, training, etc. I rarely get to use the cool tools I have now. It's rough and tough to keep things going. There is so much involved besides the craft. There is so much management involved and you the owner are the only one qualified to manage your business. A small business can't afford to hire qualified managers so you can go make sawdust. Simply put, run a hobby like a hobby. Don't try to deduct home office and garage space, electricity etc. Don't report the $125 coffee table you sold to Aunt Sarah as income and deduct the $90 wood bill, $7 in glue, $14 in varnish and the $400 miter saw you bought to build it. If you are running a business then tell Aunt Sarah that the table will cost $600 plus tax! 5 Quote Link to comment Share on other sites More sharing options...
Raefco Posted November 11, 2014 Report Share Posted November 11, 2014 no w-2 or 1099, it never happened I have moved a lot of stuff at craft shows, in the late 80's my brother and I were cranking out shadow boxes and rocking horses by the 100's all in the name of more and better tools Quote Link to comment Share on other sites More sharing options...
..Kev Posted November 11, 2014 Report Share Posted November 11, 2014 If a business actually makes money it's a business. A business that repeatedly loses or breaks even is a hobby. You can only deduct expenses to the point of loss for so long before the tax man wants it back. So you end up paying taxes on all the expenses you deducted all those years. What I'm saying is enjoy your hobby. Use the proceeds of any sale to fund your hobby. That's what makes you happy and keeps the wife smiling too. In the end you may lose a buck or make a buck. Petty cash. If you want to start a business, get the hobby out of your head. It's not that simple. Sooner or later those "deductions" become actual cash outlays that leaves you cash poor. It's not easy to run a business when most of your revenue goes to deductions. I turned my hobby into a business in 1999. Guess what? I have a new hobby now. My woodworking passion is now largely design, sales, installation, purchasing, repair, training, etc. I rarely get to use the cool tools I have now. It's rough and tough to keep things going. There is so much involved besides the craft. There is so much management involved and you the owner are the only one qualified to manage your business. A small business can't afford to hire qualified managers so you can go make sawdust. Simply put, run a hobby like a hobby. Don't try to deduct home office and garage space, electricity etc. Don't report the $125 coffee table you sold to Aunt Sarah as income and deduct the $90 wood bill, $7 in glue, $14 in varnish and the $400 miter saw you bought to build it. If you are running a business then tell Aunt Sarah that the table will cost $600 plus tax! There's a lot to be said for this very good advice. Be happy with the few bucks you put in your pocket or back in your shop rather than disappointed that you couldn't write off even more off of your taxes. 1 Quote Link to comment Share on other sites More sharing options...
Pwk5017 Posted November 11, 2014 Report Share Posted November 11, 2014 I do not have enough discretionary money to buy tools as I need or want them, and the other day I had the idea of selling simple projects to fund my hobby. I don't want to become a full time woodworker, but do want to have cool tools. The project is a simple planter, costs $50 in materials, and I've had quite a few people offer to buy them for $100. I can crank 3 out in a day. Would you consider building simple projects to sell, so that you can buy more for the shop? I don't want all my time spent making these planters, but it's a way to get paid to use wood, and fund more bigger projects. This idea was the genesis of my shop 10 months ago. I started with an unfinished basement with 3 incandescent bulbs, one 110v outlet, and a dewalt 715 miter saw and stand I bought brand new in box off CL for $125. That allowed me to make my first product, which earned about $40 an hour. I was averaging one sale a week. I then bought a dewalt portable table saw for $250(im two years out of college, so this was a stretch for me). It improved efficiency, and opened up additional projects. Next was a new in box bosch combo router and deluxe guide off CL for $150. Then, a used ridgid jointer for $200. Next, a new in box dw735x for $400. Then sold the dewalt table saw for $250, and bought a delta contractor saw from the late 90s with a unifence for $250. Added a jessem mast r slide for $175 a week later. There was a 1.5hp dust collector in there somewhere, which I added a wynn nano to. My most recent purchase was a grizzly GO441 never been used before for $700 with some spiral duct. I am looking to grab a 8" jointer and a supermax 19-38 drum sander in the next 6 months. Sorry for all the detail, but I wanted to give you the facts behind how you can start small with the most basic kit, make something, sell that something, save up for the next piece of your kit etc etc. I have gotten some sweet deals on 75% of my stuff, and that's part of the equation, but the fact of the matter is nice stuff costs $$$, and theres no getting around the price tag most of the time. My wynn nano filter for the 1.5hp DC was going to be $220ish with shipping no matter what. My JDS air cleaner has the best filters on the market and moves the most air, that was $400 I wasn't getting around. All told, I think I have made $3800-4000 out of my shop since february, and 98-100% of that has been spent on the shop. That's 1.5 months of pay at my day job, and money that I would have never been able to outlay on a shop without the prospect of earning it back. My girlfriend would have been wagging her finger--the ring finger, not the middle one--had I done that. It sounds like you already have more than what I started with, so pick one product to make where you earn a solid margin on. It takes time, but come Feb 2015, I will have a fully equipped "semi-pro" shop. You can absolutely do the same, if not better. Patrick 1 Quote Link to comment Share on other sites More sharing options...
ChetlovesMer Posted November 11, 2014 Report Share Posted November 11, 2014 If a business actually makes money it's a business. A business that repeatedly loses or breaks even is a hobby. You can only deduct expenses to the point of loss for so long before the tax man wants it back. So you end up paying taxes on all the expenses you deducted all those years. What I'm saying is enjoy your hobby. Use the proceeds of any sale to fund your hobby. That's what makes you happy and keeps the wife smiling too. In the end you may lose a buck or make a buck. Petty cash. If you want to start a business, get the hobby out of your head. It's not that simple. Sooner or later those "deductions" become actual cash outlays that leaves you cash poor. It's not easy to run a business when most of your revenue goes to deductions. I turned my hobby into a business in 1999. Guess what? I have a new hobby now. My woodworking passion is now largely design, sales, installation, purchasing, repair, training, etc. I rarely get to use the cool tools I have now. It's rough and tough to keep things going. There is so much involved besides the craft. There is so much management involved and you the owner are the only one qualified to manage your business. A small business can't afford to hire qualified managers so you can go make sawdust. Simply put, run a hobby like a hobby. Don't try to deduct home office and garage space, electricity etc. Don't report the $125 coffee table you sold to Aunt Sarah as income and deduct the $90 wood bill, $7 in glue, $14 in varnish and the $400 miter saw you bought to build it. If you are running a business then tell Aunt Sarah that the table will cost $600 plus tax! This is sage advice. I will also add once you start a "business" you risk the feeling of "Have to make the donuts." Suddenly hanging out in the shop is no longer an escape, it's now drudgery. This is a thin line, be careful. Since I've been visiting this forum I think the most common post I've seen from anyone is this question, or some variation of it. It's a really tough question as the situation is so different for everyone. 1 Quote Link to comment Share on other sites More sharing options...
T-astragal Posted November 12, 2014 Report Share Posted November 12, 2014 That's why I have a new hobby! Lol Steve 1 Quote Link to comment Share on other sites More sharing options...
ChetlovesMer Posted November 12, 2014 Report Share Posted November 12, 2014 HOLY MACKEREL!.... or are those tuna? ... I know they're not swordfish... Ah what do I know I went to Chicago Public Schools. Quote Link to comment Share on other sites More sharing options...
Vyrolan Posted November 12, 2014 Report Share Posted November 12, 2014 I went to Chicago Public Schools. My condolences... 1 Quote Link to comment Share on other sites More sharing options...
..Kev Posted November 12, 2014 Report Share Posted November 12, 2014 My condolences... ahmen! Quote Link to comment Share on other sites More sharing options...
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