Hello All,
To be brief, we did a Kickstarter campaign for a film project and raised $45,000. The campaign ends today and then Amazon Payments holds the funds for 14 days but we could wait until 2015 to withdraw the money. Amazon reports the income as a 1099-K and since the transactions will be individually processed in 2014, the incoming funds are reported for 2014 regardless of when we actually receive the money.
Unfortunately, the bulk of our production and expenses will take place in 2015. My fear is that because the 1099 is going to reflect $45,000 of income for our production company in 2014 and then all of our business expenses are taking place in 2015, that we're essentially screwed on our taxes for 2014 and will pay full tax with no deductions. We will certainly spend all $45,000 and more on production costs in 2015.
Does anyone have any insight on how to handle this? Should we scramble to spend as much as possible before then end of the year? Are there other things i'm not considering?
Thanks!