From: a touch of william
(Ryan Boeskool, located in Jackson, Michigan, is a District Director for U.S. Rep Tim Walberg's office)
I have been referred to you by the Reverend Richard McKenzie, who indicated you have been very helpful to him in the past. We both sit on the Board of Trustees of the Teaching & Sharing Centers, a Michigan nonprofit corporation, and IRS approved 501c3 public charity. It grew out of my sole proprietorship outreaches (“businesses”), and ten years ago (due to lack of funds), although I am neither an accountant nor an attorney, I personally completed and filed the paperwork. The following is an excerpt from an email I sent to the T&SC Board of Trustees on December 30, 2014.
I have attached a letter from my tax preparer which indicates, according to them, my outreach “businesses” under IRS regulations must be designated as a hobby because they are not profitable. I spent two hours on hold with the IRS this morning trying to get clarifications on what my options as a sole-proprietor spiritual resource center and outreach were. When I phoned the number listed for businesses, I spoke with Mr. Wilson, whose job is apparently to decide where I should be transferred to. Mr. W------e (#1-------48), the second fellow I talked to (after the first hour on hold), who was in the business section, seemed to be genuinely interested in trying to help me. He said he had never heard of such a thing in all his years with the IRS. That there were no restrictions, and that any size of an enterprise (even a hot dog stand – his words) can be a legitimate business, but that he was not specifically trained on Schedule C issues. After wrestling with what else he might possibly be able to do, he transferred me to 1-800-829-1040 where I was on hold for another hour before Miss P--a (#1-------72) told me she could not answer my questions. She offered that I could hire an accountant or an attorney, or I could research the issue myself online, at the IRS.gov website where I could do a search for “hobby.” I am not entirely sure she understood what I was talking about. I asked if she had a supervisor, which she did, but apparently that line was busy when she checked. She said the supervisor would not be able to help me either, anyway. When I asked why the IRS could not answer questions regarding its own regulations, and asked that, since I had been on hold for two hours with no resolution, she please pass along a complaint to her higher-ups about the matter, she very politely said “thank you for calling the IRS” and hung up.
I will not sign anything that calls my response to God, and the work of the past 20 years, a hobby. By every criteria, except monetary profit, what I do is a legitimate enterprise. But, unless things change between now and our February board meeting, there is no point to my remaining a separate enterprise if the expenses, which come out of Donna’s and my household income, cannot be deducted from our income beyond the miniscule amount of income atow/CBTC takes in . . .
My email goes on to prepare them for discussion on the possibility of needing to merge my operations into those of the nonprofit corporation. I have attached a copy of the accounting firm's letter to your email as well in which it is stated, we have determined that the correct reporting of your Schedule C income and expenses is as a hobby rather than as a business . . . . . . If you choose to have our firm prepare your 2014 return, we will be preparing it in this manner.”
In a follow-up email he provided an IRS URL with a note to please review the section that includes factors the taxpayer should consider. Based on our conversation it does not seem as if your circumstance support the idea that you are engaged in this ministry to make a profit.
In the twenty years that I have been operating my enterprises, I have never claimed my motivation was to make a profit. I have always explained I do what I do because I feel God has asked me to do it. If I had more money come in than I spent in expenses in any given year, that would be wonderful. But the opening image on my website says, “Life is not about making a profit. It is about making a difference.” It would be hypocritical of me to make profit my main focus. I could, of course, look for a different tax preparer. But if the issue is IRS regulations there would be no point. Truth is paramount in what I do. Without help or clarification from the IRS regarding the matter, I perceive the only alternative is to discontinue functioning as a sole-proprietorship completely. Since we are at the beginning of a calendar and fiscal year, as of January 1, 2015, I have ceased my operations until I can determine what is the legitimate way to proceed.
Allow me to give you a little bit of history, and why I have seen myself as a legitimate enterprise (“business”) all of these years. For 20 years, I owned my own business, as a State Farm insurance agent, in the same location as my current enterprise. Twenty years ago, I simply removed the face of the fluorescent sign on my building which read State Farm Insurance, and replaced it with one which said Sharing in Christ. Granted, the One with whom I have my new contractual relationship is seen as intangible by many, and therefore not a valid Entity, but I saw it simply as changing the business direction of my life as a sole proprietorship. I have made it clear right from the beginning that God is my motivation for transitioning and operating this enterprise, not money (profit). I was told, by the accountant who owned the [same] firm back then, a sole proprietorship enterprise is always designated as a “for-profit” business by the IRS. So, there was no reason to question the issue. Over my twenty years of operation, I simply made it very clear to those supporting my work that legally I was filed as a for-profit business, and therefore any contributions they might make were not deductible, as they might be to a nonprofit organization. I have spent twenty of my most productive work years, going to work daily, operating my enterprise without pay. This decimated my Social Security benefit when I became eligible, and brought my other retirement accounts to a standstill. No one makes such a decision for a mere hobby. In my twenty years as an independent State Farm agent, my contract could not be terminated except for theft, or blatant disregard of my (the company's) policyholders. I could not be downsized. I had no production quotas. I truly owned my own business. My relationship with State Farm allowed me to purchase affordable health, life, and disability insurances. Most people would love to have such security. I had to willingly give that up. You do not give up such security for a mere hobby.
Additionally, this is my sole occupation. I work more than full-time hours at what I do. It is not something I do on the side while employed someplace else. After releasing the Teaching & Sharing Center of Grand Ledge, christian life programs, and the poet’s circle pieces of my original operation to the T&SC nonprofit ten years ago, I still operate a touch of william, Cherokee Bill's Teaching & Trade Center, and the www.wsharing.com website, independently as a sole proprietorship. I occupy over 1500 sq. ft. in a two-story stand-alone building, at 417 South Bridge Street, in the (zoned) downtown business district in Grand Ledge. I have a gift shop, the lending library, an art gallery, and a Cherokee historical and cultural display room in which I teach about the Cherokees. I also have a basic office area and some work areas there. Each aspect of what I do has multiple dynamics (I have listed the mission statements for each below my signature in this email). I maintain separate email addresses for each of the aspects, separate from my personal email address. How all of these varying dynamics could be seen as simply one hobby I do not know. I certainly would not go to all the expense and time. I pay for a separate business policy through State Farm insurance. If I were just a hobby there would be no need for such a policy. It would be covered under my homeowners policy. I maintain a separate business telephone number, which I have now had for over forty years. I purchase materials for the business/outreaches I would not otherwise buy for myself as a hobby. I have a part of my accounting system set up to keep track of the movement of any products between our household and the business, either way, keeping things very separate. The structure of my accounting system is even a carryover from my State Farm days. I have an office in my home as well, so I can work late into the night when I do not get enough accomplished during the day. I do not deduct the expenses of an in-home office, precisely because I have a full-fledged “business” location elsewhere. I cannot imagine anyone putting in the amount of work and hours I do in my enterprises, if they were only engaged in a hobby. There would even have been no point to doing all the paperwork, and setting up all the systems for the T&SC nonprofit corporation if all I were engaged in was a simple hobby. I would not have put forth that amount of work outside of my area of expertise.
This year I decided it was time to upgrade the lending library at the Center. A substantial influx of new items had not been done in some time. I wanted to add books of some new Christian authors, and much of the video section was still the old VHS tapes format, while most people have been switching to DVDs. So in 2014, I spent $974.57 primarily on new hardcover books and DVDs. I make almost all purchases through my gift shop (Cherokee Bill's Trade Center ) at wholesale to keep my costs as low as possible. Seventeen different suppliers, organizations, or publishers in our economy benefited from these purchases. The purchases include items I will likely never personally have the time to view or read. I would not make such purchases as a hobby. I do these things, because I see them as my outreach “business,” the enterprise God has asked me to operate. It is quite likely I would not be able to afford such purchases as mere donations to the T&SC nonprofit, after taxes. I live by the biblical admonition of being debt-free. I would not even consider borrowing to expand what I do in order to try to make it more acceptable for IRS purposes. I work only with what I have. Income wise, that has been less since the incorporation of the T&SC. It is logical that people would choose to put their donations where they are tax-deductible.
I had a young man visit the Center this year. He has purchased a few items over the years from the gift shop, but mostly he comes by to talk. He indicated while he was in the hospital recently, someone stole from his apartment the CDs and books he had purchased from me. We started gathering some of the items which I still had in stock. The total of the items would have been around $75. He reached into his pocket and pulled out all the money he had, a twenty and four ones, and asked how much he could buy with it, handing me the cash. I gave him the entire $75 worth of products, and handed him back his twenty. I told him the four dollars would suffice, that he needed the rest more than I did. I am well aware that for-profit businesses do not operate in such a fashion. I have never claimed to be a for-profit business, except when I had to make it absolutely clear to people that outright contributions to me or direct support of what I do are not tax-deductible. I have only ever claimed to be a “God” business. It seemed quite reasonable twenty years ago that the IRS likely had no such category. So I accepted how the accountant needed to list me to fit into their (IRS) system. But I will not accept being called a hobby. I believe, by almost every criteria except profit, I operate a legitimate enterprise.
I can continue some of my work simply as a volunteer for the T&SC nonprofit organization if I merge my entire operation into the non-profit. However, the additional tax burden on our personal incomes will lessen the resources available to personally subsidize any shortfalls or expansions, and the nonprofit is in no position to afford the additional expenses. So I would still need to subsidize my activities out of our personal incomes, without any tax relief in that circumstance. If this is God's way of telling me it is time to move my operations into the nonprofit, then I am certainly more than willing to do so. However, at this point, the only people telling me I do not qualify as a business is the same place (although bought out several times) that set me up as a business in the first place. All I have is the attached letter from S---- Accounting & Tax Services (the current owner of the Portland office where my taxes have been done these past 20 years), and they, although having done my taxes for several years, have never even visited my establishment to see my operation, and what I do.
I am happy to go in whichever direction God wishes, and even the IRS. That was my intention in trying to contact them. Internally, to bring everything into the T&SC, the changes are significant, and it will take some time and extra effort to work them all through. Before I would make a merger into the nonprofit, it would be nice to know that it is indeed the IRS, and not just the accounting firm, which says I cannot any longer be designated as a business, and there are no other options as a sole proprietorship enterprise than being referred to as for-profit, or as a hobby with limited deductibility of expenses. If you can help by finding someone at the IRS who can answer this question, it would be greatly appreciated. Thank you.
In February, I will need to file my Sales, Use, and Withholding tax form with the State of Michigan for my businesses. That form usually includes a discontinuation of business notice to accompany the SUW if needed. About that same time in February, the T&SC Board of Trustees will be meeting. I figure I will need to make a decision by then. Thank you again for any light you can shed on what choices I might have.
a touch of william
I try to impact (touch) people's lives through my poetry
- Break out of the boxes the world would keep them pigeonholed in.
- Discover and develop their own artistic and spiritual gifts.
- Grow in their understanding of their relationship with nature.
- Get further in touch with their own spiritual reality.
- To teach the genuine history of the Cherokee Nation
- To assist those embracing traditional indigenous (Indian) philosophies and paths as Christians
- To expose the public to the artistic, spiritual, and historical
gifts of the Cherokee,
- To heighten awareness of historical and present injustice and prejudice
To take the
Good News of Jesus, the Christ, into all the world, along with, and through,
My computer is usually kept turned off from sundown on Friday (beginning of the Sabbath) until very late on Sunday (end of the Lord's Day). Therefore, I typically do not see, nor have the opportunity to act on, reply to, or send, emails except on weekdays. Plus, I normally only check emails once each weekday morning, so later emails are not seen until the next day (or Monday if sent on a Friday). Please keep this in mind when deciding whether to email or phone.
I am not on Facebook, Twitter, or any other online social media site. So, in addition to creating and maintaining the wsharing.com website (have you visited it lately?), I currently maintain two emailing lists for sending information, updates, and greetings:
atow/CBTC email list (formerly the poet’s circle) keeps you apprised of basic information from a touch of william and Cherokee Bill's Teaching & Trade Center, as well as updates, changes, and new additions to my wsharing.com (.org and .net) website. This is my own separate list from the T&SC corporate list (the poet’s circle). Simply reply to my email address to request addition to or removal from my atow/CBTC list.
My personal Family & Friends email list is used primarily for holiday greetings or other more home life related communications and information, although very occasionally I might use it along with the atow/CBTC list to announce something important which is related to my work. Simply reply to my email address to request addition to or removal from my Family & Friends list. Those on my F&F list normally receive a birthday greeting by email. If you are receiving other F&F emails but not a birthday e-card, I probably do not have your birthdate in my files. Please provide me with the date. I would very much like to acknowledge your birthday.
If, for any reason, you feel the need to be removed from either or both of my lists, this is fine, just let me know. All I ask is that you please not designate my emails as 'spam.' They are not that. Doing so could sidetrack them for others who wish to receive my emails. I have never sent spam and never will. If you are on my list(s), it is because you requested it, or our prior contact or relationship seemed to deem it appropriate (such as merging our Christmas card list into the F&F list).
Helping to identify and stop spam: All emails from me clearly state the topic in the subject line. If there are any links, the complete URL is shown and the reason for the link described in the body of the letter. If I am including any attachments, they will be identified and mentioned in the body of the letter as well. When mailing to either of the above mentioned lists, I always use the blind carbon copy (Bcc) line so your email address does not appear in the email. My address books are kept only in my computer and not online anywhere. I do not forward petitions, lists, or similar items that show addresses, as these can be bogus attempts by spammers to collect them.
If you add me to a list of yours, or whenever you are sending me multiple recipient emails, I would appreciate it if you would please use my email@example.com email address. It is my most public address.
If you are replacing a working computer system or laptop with a newer one, live locally enough to drop your old one off at the Center (or have it picked up), and would like to donate it to my a touch of william outreach rather than try to find where to recycle or dispose of the old one, I freely place functioning used systems (Windows XP or later operating systems) with my slide shows into nature centers, museums, and other places where they are desired. Call me (627-7366) if you have a system or laptop to donate.