craft vendor info

[tav-2020]

Hi All - apologies in advance if this rambles a bit.
Some background - I am a "crafty" person, in the good way. I make a lot of things, sew, knit, crochet, beading etc.  For the past couple years I have been doing a couple local craft fairs (schools, church, etc.) nothing too big, mostly to fund my hobbies.

After making the decision to plan for a full-time retirement rv life I decided to step it up a notch this fall and expanded the items I make. I was shocked at how well I did at a local craft show last weekend. 
I think I could do this part -time on the road for extra income but this then moves my hobby into the realm of a small business (blech!) and all the accounting/taxes/etc that goes along with that.

So a few questions for those of you who actually do this, follow shows etc.  I know about festival.net and do not think I would have trouble planning my routes around finding shows.
I also have online accounts for accepting credit cards & payapl, etc, so do not need that kind of financial advice.

What I need to know is (these are multi-part q's - and, no I can't make it ti RTR to attend a seminar on this):
1. What licenses or vendor docs do you need to do this legally? 
2. Is a license from your "home" state good enough or reciprocal in other states? Are there states to avoid because the permits or licenses are just too much of a hassle?
3. What state is the easiest to consider setting up your vendor license with and/ or easiest to deal with sales tax issues?
4. Do you track and deduct mileage and travel expenses?
5. Obviously you can track and your deduct production supplies but has anyone been successful writing off partial purchase or value of your rig as a "traveling workshop?"

Sure, I bet there are plenty of opportunities to just deal in cash and keep it all hush-hush legally, but with other finances to wrangle I feel I would be more successful getting it properly set-up and working. I do travel a bit in my current job and don't have any problems tracking things and keeping records, tax and other-wise.

thanks for sharing your knowledge/experience! 
Mods: I chose Hobby forum as I thought the craft folks were the real audience I wanted to reach, but if you feel this belongs in Money-making forum feel free to move.

 

[Almost There]

What I need to know is (these are multi-part q's - and, no I can't make it ti RTR to attend a seminar on this):
1. What licenses or vendor docs do you need to do this legally? 
2. Is a license from your "home" state good enough or reciprocal in other states? Are there states to avoid because the permits or licenses are just too much of a hassle?
3. What state is the easiest to consider setting up your vendor license with and/ or easiest to deal with sales tax issues?
4. Do you track and deduct mileage and travel expenses?
5. Obviously you can track and your deduct production supplies but has anyone been successful writing off partial purchase or value of your rig as a "traveling workshop?"

I did this for 14 years full-time on the road and several years part time before that. I spent my winters mostly in the southeast and my summers anywhere from Cape Cod to the midwest.

1. Most states require you to have a sale tax license. Some events will have their own license so that you can report sales to them and hand them the tax money but it's rare. Most shows require you to supply your tax license number on your application. Some states will allow you to have a one time only temporary license but if you do that same show the next year, you'll need a permanent license. Some shows have a tax auditor coming around to make sure you  have your license on hand and posted and will supply you with one on the spot if you don't have one already. Only the smallest of local shows won't have already been forced in to complying with sales tax agents.

It's a PITA if you're doing a large circuit. I ended up with sales tax licenses from 7 different states. Some required monthly reporting, some quarterly, some annually. Some like Florida have different rates for each county so you  have 3 pages to fill out identifying your sales by each county. If you do after market shipping, the sales tax is based on delivery address, not yours. Accounting was a nightmare and I spent 25 years in accounting.

2. No other license is required unless you're selling food products although it's not a bad idea to register at least a DBA. You can use this to open a business bank account to keep your money separate from business money.

3. Doesn't matter because you're going to have to have sales tax licenses from each state you're doing business in anyways.

4. Keep track of every penny you spend on business related items. You'll need them for your tax return, you are running a business so you don't want to have to pay more taxes than you should. Rather than trying to separate personal gas on a item by item basis, I opted for tracking mileage and using the percentage business related vs personal use for auto deductions. Sooo, I kept track of every penny spend on automotive related expenses and then did the calculation annually.

5. I didn't try to write off my travelling workshop because all I would be able to do is claim depreciation and then I would have had to recapture it if I sold it for more than depreciated value. If you're leasing a vehicle then it would make sense to claim the lease expense.

As you might not have noticed yet, starving artist is not an oxymoron...you'll be lucky to break even on income/costs for the first few years. It's worthwhile tracking all your expenses if for no other reason than to be aware that it's not often profitable. You can also carry forward your losses for a specific number of years before you lose the deduction.

Do not shortchange yourself if you are making a profit. I had a friend who did car show circuits who always managed to skate close to the profit/not profitable line. When it came time for SSI, he hadn't been paying in to it a whole lot...guess what.. his payout reflected what he'd put in of course so now he's extremely broke!

 

[tav-2020]

I did this for 14 years full-time on the road and several years part time before that. I spent my winters mostly in the southeast and my summers anywhere from Cape Cod to the Midwest...

Thank you, Almost There.  I thought there might be complications with the sales tax and you have confirmed. I am fortunate that I would not have to rely on this extra income to get by, it would just be some extra. So I would probably stick to smaller shows, and certain states rather than get licensed up everywhere. I don't see the point in having to sell $200 worth of stuff to just pay for the 10x10 space...business or not.
I know I will not stop making stuff when I am on the road so maybe getting into a show every couple months will generate some mad money and still give me that creative outlet. And what does not sell can be given away.

 

[SondraRose]

Have you considered setting up an online shop?  Etsy is the best known and I have bought quite a bit there.  You would have the hassle of shipping, but it may solve the sales tax craziness.

Another option is to consign your work to craft galleries.

 

[dragonflyinthesky]

I sell off Facebook. Etsy is great but it truly is a lot of work, more than I can keep up with. I design smaller art now that fits in bubble packs or the free USPS boxes.

Red

 

[tav-2020]

Yes, I was on etsy early, like 2007, when it really was only for hand crafted items. Now it can be a re-sellers stint too, and I gave up trying to keep listings in the top without forking over $$...too much work! I still have my shop there with a few items, just to keep it alive, but don't have time to generate traffic.
I am on FB but have not looked into selling there yet. Probably should. Thanks for the tips!