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Deductions & credits
i offer a warning. if the side business is continually unprofitable (, the IRS could take the position it's a hobby.
Basically, according to the IRS’s hobby business tax rules, if profit is rare, you have a hobby, but if you regularly earn a profit, you have a business. Specifically, if you turned a profit in three of the last five years, you probably have a business.
with a hobby the income is taxable but deductions are limited to hobby income and can only be taken if you itemize.
June 11, 2021
4:48 PM