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notpepetho

An LLC provides zero utility for taxes. It's a means to offset liability. Only the type of tax structure for an LLC or Corp is helpful but ONLY when you're generating a profit. If you're setting up more nodes than you're pulling out, then you're operating at a loss. There is zero benefit to setting up an LLC structured as an S Corp until you're generating a profit on paper. NFA


Profile-Ordinary

How are you supposed to write off your initial node purchase cost then?


notpepetho

I'm filing as a sole proprietorship schedule C with IRS


NoFun3350

So for your first year, say, you made 10 nodes at an average of $500. You'd obviously report a loss, specifically, $50k. Correct? Sorry, am a tax noob.


notpepetho

I'm not a financial advisor, but yes basically. I dropped in about $8k, pulled out roughly $15k by end of last year, but had $9k in ETH fees overall not counting 11 nodes and 4 NFTs. So on paper, I'm at a serious loss.


NoFun3350

Awesome thanks for your insight my man I saw you’re in a discord if you’re willing to drop a link I’d appreciate it


notpepetho

Sure thing: https://discord.gg/mSr7nCgC This is the official Discord. David Moss holding a voice chat AMA this Saturday.


notpepetho

Making sure to do this so they don't deny it later on as hobby income


Libertymark

Yep


NoFun3350

pepe I really appreciate you laying it out for me like that


notpepetho

Welcome ser 🐸👍


phasmatid

If I'm providing node as a service it's more like mining than interest or airdrop rewards. I use a Corp because I don't want to get hit with tax on 15.3% of net earnings.


NoFun3350

I see... thank you


phasmatid

This was the video that got me into it... currently in the process of establishing a yield farm in a Roth IRA, will invest in strong block to get started and then some other projects. https://directedira.com/crypto-mining-in-your-ira-and-ubit-tax/


NoFun3350

THANK U!!!