It sounds like your activity might qualify as a hobby. To determine how to treat it, it comes down to your intention, combined with how often you experience a loss.
If your intention is to make a profit and you haven't had losses in more than 3 of the past 5 years (including 2017), then it would most likely be classified as a business.
However, if your intention isn't to make a profit or if you've experienced losses many years in a row, they you should consider reporting it as a hobby.
The IRS provides the following to consider when deciding how to treat the income and expenses:
"...taxpayers should consider the following factors:
- Does the time and effort put into the activity indicate an intention to make a profit?
- Does the taxpayer depend on income from the activity?
- If there are losses, are they due to circumstances beyond the taxpayer’s control or did they occur in the start-up phase of the business?
- Has the taxpayer changed methods of operation to improve profitability?
- Does the taxpayer or his/her advisors have the knowledge needed to carry on the activity as a successful business?
- Has the taxpayer made a profit in similar activities in the past?
- Does the activity make a profit in some years?
- Can the taxpayer expect to make a profit in the future from the appreciation of assets used in the activity?"
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To enter your activity as a hobby, search from within your return, in the top right search bar and select the first Jump to link that results.
