Yes, the expenses can be deducted. However, how they are deducted will depend on how your business is characterized.Below is information for entering income as self-employment income (Form Schedule C) or hobby income.
In TurboTax Deluxe, Premier, go to Federal Taxes or In Home and Business, go to Business tab- then Continue
- Choose Explore on my own or I'll choose what to work on (if it appears)
- Scroll down to Business Income and Expenses - Click the Start or Update button
- If needed, answer the interview questions regarding your business. After completion, you the TurboTax will move you to the Business Summary screen.
- From here you can edit information for your business that includes the Business Profile, Income, Expenses, etc. Please see the image below.
- To enter Income, click start or update next to Business Income
To enter as Hobby Income, please follow the instructions below:
- Federal Taxes tab
- Wages & Income
- Explore on My Own
- Scroll down to Less Common Income
- Next select, Miscellaneous Income, 1099-A, 1099-C and click Start or Update
- Scroll down to Hobby Income and Expenses
- Click Start or Update
For assistance in determining if you should enter your information as a business or hobby, please see the IRS Publication on Business or Hobby.