USA Side Business Offering Firearms and Defense Training - Deduction Question

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Best I could find on this was a LinkedIn article and lots of security guard related items to a single handgun, rifle, or self defense classes.

I offer classes on marksmanship, firearm safety, as well as strategy and defensive maneuvers. I'm new to it and the turnout has been very small.

Part of the classes is range time where the typical student shoots 200+ rounds. I'm concerned I won't be able to deduct the cost of ammunition provided as a component of the class. Also, I spend extensive time honing my own skills to be able to teach these classes - this causes me to incur course expense as well as shooting through many rounds and familiarizing myself with different firearm formats (handgun, shotgun, rifle).

The items I'm specifically looking to deduct are:
  • Firearms (limited - I only anticipate purchasing 5-6 and have only purchased 2)
  • Ammunition
  • Targets
  • PPE - eye & ear protection
  • Optics
  • Shot timers
  • Course attendance & instructor certification
  • Safe for protecting business firearms stored at home (my personal safe is full)
  • Range membership
I appreciate the help on what I feel like is a very narrow question. If anyone knows of any documentation out there I would surely appreciate it!
 

DrStrangeLove

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From what you wrote, the biggest issue I see is dual-use (business use vs. personal use) assets.

Take the safe, for example. Your personal safe is full. If you get yourself another firearm, will you keep it in your "business" safe? If so, then a portion of the cost of the safe is not deductible, since it stores both "personal" and "business" firearms. Is your range membership at the range where you shoot for fun (personal use)? Do you use the same ammunition to train students that you use when you shoot for yourself? The certification courses clearly have a business purpose. I don't know what shot timers are, so I don't know if they also face the same business use/personal use issue.

Part of your deductions you'll want to take will be depreciation on the more expensive assets, such as for the safe, the firearms and the optics--all durable and potentially quite expensive. For these assets, you have to be careful that more than 50% if your use is business use and not personal use. Otherwise you may have to recapture a bunch of depreciation and declare it as gross income. That can become a real problem if you take bonus depreciation or a Sec. 179 election early on. If you look for tax articles about business use vs. personal use of business assets, you'll see what I mean.

If you can avoid using your business assets for personal use, you'll simplify your tax situation. Talk to a CPA in your state for further and better advice as to how to handle this issue and what sort of documentation you need to substantiate your deductions.

Hope this helps.
 

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