I have been reading on this forum for the last two weeks or so. I finally registered yesterday in order to get some feedback on a wild and crazy idea that I have. First off I have a good job for the area that I live so I am not trying to get rich quick or trying to quit my day job right away.
My hobby and passion is cars, especially older cars. I am 26 years old and own a rare musclecar that my dad bought me in high school, it is not in the greatest of condition but you would be amazed at all the offers I get on that car. But since I will never sell that one I decided in January to purchase another similar car in far worse condition that I found very cheap in order to "flip". I bought it for $2500 and I am now selling it for $4500. I was offered $500 for just the hood.
I know there is a market out there for these cars and parts in any condition, just look on ebay at any given time and you will see what I mean about junk cars in my opinion selling for 5-$6000. The catch is that you have to buy them from individuals that dont have them advertised in order to get them cheap and then put them in a new market such as ebay, carshows/swap meets and the like where people are willing to pay top dollar for a "project car". I am not restoring the cars just doing only what is neccesary in order to "flip" them for a profit. This car that I am selling will be my first and I have learned the hard way on a couple of things on this one but I believe I will still make a profit.
While I do have a good job things do get very tight when it comes to hobby money(BABY DUE IN JULY). So I think this could potentially be a way to dabble in my hobby on limited funds and make a small profit. Now to my questions:
1)When I do sell this first car, if I were to purchase a trailer and other tools/supplies could I write them off as legitimate business expenses?
2) What sort of organization would I have to create in order to do such a thing? Is it neccesary? Or possible? What is involved?(I live in South Carolina)
3)If that is possible would I be able to count the money used to purchase the cars as a business expense.
4) Basically I want to dabble in the hobby, make a little cash and let the system work for me while having a possible extra income until I can follow trough with bigger and better ideas. This is only going to be a side thing.
I hope that I am not wasting everyone's time. Thanks.

Any business expenses will deduct from your gross (total) income and that includes tools, equipment, car purchases and parts. All profits you make should be declared and made known to the IRS. They will tax you on your profit (and monitor you from then on).

If you only want to 'dabble' then it wouldn't be worthwhile to declare anything. Pay cash for everything and declare nothing. But make sure you recieve cash for everything. Keep super quiet about it all and tell no one anything (I mean NO ONE). Don't boast about profits or even complain about losses.

Following up on the legals, I believe incorporation is suitable in your circumstance.