Making money on the side?

[Hot dog]

Does anyone sell avon, pampered chef, or anything like that on the side and is it worth it? I am thinking about selling Tastefully Simple and was wondering if anyone had any tips or horror stories bout signing up to do something like that. Any good tax incentives?

[disneysteve]

My wife did the Tupperware thing once. Basically, with any of those home party products, you annoy all of your friends, family and coworkers to come to and host parties. You make a few bucks and then once you don't have anyone to annoy anymore, you're done. How quick that cycle is depends on how many people you are able to guilt into hosting a party.

[GREENBACK]

I remember an aunt and uncle selling Amway products many years ago. They had shelves of this stuff. They were very nice people but annoyed the hell out of everyone that stopped by with their new found sales skills. They stopped before they were removed from everyone's xmas list. That convinced me to never go this route.

[jIM_Ohio]

If you know any sport (baseball-soccer-basketball) you could probably make more money reliably by officiating adult and youth games.

If I wanted to I could clear $200 on a Saturday reffing soccer games and another $200 on Sunday too. (7 games, just shy of $30/game).

Costs around $50 to go thru rules course, and another $70 for the uniform.

You can schedule this how ever often your life and body can take it, and you will be bugging people you don't know, which is better than doing business with friends.

[Hot dog]

Am I fooling myself cause I really like their product. I did a party and it seemed to sell itself. I sold like 1500 worth in like two months. I really would be doing it to just buy the products myself but I do have to make 400worth of sales every three months. So I would only bug 1 friend every 3 months. Then I started wondering would I get tax breaks and maybe I could make some money. I don't want to get on peoples nerves with it though

[MonkeyMama]

I think a lot of the more established companies go like the above.

I did selling for a less established company. I didn't do parties or bug my friends. Made some money on the side. It was a good deal. The thing was it was jewelry, I wore it, people commented on it, they bought it. I got a discount. That's it.

BUT this company was unique in they were willing to welcome "personal shoppers" for a long time. They decided last year to push us out and I got cut off with no warning. It was a little uncalled for. So yeah, not much nice to say any more. If they handled it differently I wouldn't care so much. I knew it wouldn't last forever. We had larger discounts than most direct sell companies, and little as far as quotas for people like me. But yeah I had to be in the middle of signing up a recruit and placing an order for a friend to find out I was no longer a consultant. Ouch! I am currently boycotting them for the lovely treatment.

Anyway, I did have to comment though because there is NO tax benefit for these things. Being in a pyramid sales type company is a sure way to get under the IRS radar. These things get audited all the time, because they don't make money. The IRS disallows all the losses arguing it's not really a business because you don't make any money. Then they start auditing your entire tax return. Plus, the other sellers will give you terrible tax advice. I have some of these people come through my office (I am a CPA/tax preparer) and argue with me because someone told them their maid, their manicures, and their personal clothing were tax deductible. Ugh!

[MonkeyMama]

Yes, you are probably fooling yourself. More like they are fooling you.

I think overall there are a lot of better/easier ways to make money.

[disneysteve]

So I would only bug 1 friend every 3 months.

No. You'd bug more people than that more often than that. You may not make that $400 at every party. You make the most when you first start out and you find people who are new to the product line. After that, it gets a lot harder once the folks you know have all bought the stuff that interests them. Also, keep in mind that a lot of people feel obligated to buy something when they come to a party, but that only works once. After that, they may decline to attend or to host.

I think depending on soliciting friends and family to make money is a bad idea all around.

[Hot dog]

So you get no tax breaks for anything if you use you computer or have to buy things to prepare the food for the partys it would not be tax deductible. I thing they told me it would be. One said that they could claim liquor to make one of the mixed drinks they sell. So one of their products is beer bread you just add a bottle of beer but you use it in your party demonstration to taste you could not claim the cost of the beer on your taxes?

[MonkeyMama]

You can deduct those things, but if all you have is losses, good luck with the IRS.

[jIM_Ohio]

Need to use the computer 100% for it to be deductable, I believe. Similar rules for a car.

The cost of the beer would be deductable.
If you are unsure, pay $150 and take HR blocks tax course next fall (or a similar course offered by someone else).

[disneysteve]

Need to use the computer 100% for it to be deductable, I believe. Similar rules for a car.

Jim. I don't think that's true. I think you can deduct on a proportional basis. You just need to keep really good records. For example, when I sold on ebay regularly, I used to deduct a portion of my internet access fee and I also used to claim the car mileage related to the business - miles driven to yard sales, auctions, thrift shops and such for buying merchandise to resell.

[jIM_Ohio]

Steve- not questioning the milage- I was talking more of deducting the car payments themselves as an expense.

I don't remember for sure, but I think the difference between internet access and the cost of purchasing a new computer are classified differently- which means how their costs are tracked for a business are different.

A computer is a tangible personal asset, where as internet access is a service and considered an intangible object.

I am new at the tax issues here... but I know cars for certain (AFAIK) you can deduct the milage (but not the car payments) unless the car is used 100% for business.

[mommyof4]

My wife did the Tupperware thing once. Basically, with any of those home party products, you annoy all of your friends, family and coworkers to come to and host parties. You make a few bucks and then once you don't have anyone to annoy anymore, you're done. How quick that cycle is depends on how many people you are able to guilt into hosting a party.

I found the same thing with Pampered Chef.

I do sell avon, but not aggressively. I have been a rep for about 6 years now, and most of the time, I just purchase the items for my own family at a discount. They have good shampoos/body washes/deoderants, etc. that I can buy very cheaply with my discount. Once in a while, one of my teacher friends will ask me to purchase them something, and I always just charge them my cost , and split the shipping with them. I don't place an order every campaign, either- maybe just once a month or so.

[Seeker]

Steve- not questioning the milage- I was talking more of deducting the car payments themselves as an expense.

I don't remember for sure, but I think the difference between internet access and the cost of purchasing a new computer are classified differently- which means how their costs are tracked for a business are different.

A computer is a tangible personal asset, where as internet access is a service and considered an intangible object.

I am new at the tax issues here... but I know cars for certain (AFAIK) you can deduct the milage (but not the car payments) unless the car is used 100% for business.

Maximize Deductions

Depreciation on your computer or cellular phone, but only for the part of the time you use your equipment to keep track of your taxable investments (stocks, bonds, mutual funds) or as part of your job, if required by your employer.

You'd have to keep very clear consise records.... and it could be a red flag to IRS... especially if the deduction seems to stand out too large.

Some computers (laptops) are actually business property and not-deductable if used for these purposes. So be careful with this.