Just to clarify - there are expectations of a profit motive if you are actively operating your business.
The IRS wants to see that you have a profit motive, and expect to see a profit in three of five consecutive years. If you don't meet that standard, they may reclassify your business as a hobby and disallow any losses. If you have been claiming business losses without ever showing a profit, it may raise a flag for them.
Please see this TurboTax article for further information: When the IRS Classifies Your Business as a Hobby
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
