@leeloo wrote:
The IRS expects ytou to show a profit from 3 out of every five years.
The IRS has no such expectation.
Section 183(d) of the Code creates a rebuttable presumption that an activity is engaged in for profit:
If the gross income derived from an activity for 3 or more of the taxable years in the period of 5 consecutive taxable years which ends with the taxable year exceeds the deductions attributable to such activity
Although the IRS can rebut the aforementioned presumption at any time, the presumption actually works in favor of taxpayers.
