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Business & farm
see this link where the IRS puts forth criteria.
under IRC code sec 183(d) an activity is presumed by the IRS to be for profit if it generates net income in 3 out of 5 consecutive years ending with the current year.
but your activity hasn't been around for 3 years. it's up to you to determine whether you're trying to achieve and will likely be profitable.
even if after 5 years, if you have not had a profit in 3 years and the IRS audits and concludes it's a hobby that can be refuted if you can show how you'll turn things around. things that could be used include a written plan where you detail the steps needed and how to accomplish this.
May 31, 2022
9:07 PM