This sounds more like you have a business and not a hobby. For a business you can subtract your expenses from your income so you will only be taxed on the net income. However, you will also have to pay Self-Employment taxes which cover both the employer and employee portions for Social Security and Medicare taxes. Then one-half of your SE taxes are entered on the tax return as an adjustment to income, lowering your Adjusted Gross Income.
Business income and expenses are reported on Schedule C which is part of and included with your federal tax return, Form 1040.
Go to this IRS website for the difference between a hobby and a business - https://www.irs.gov/newsroom/heres-how-to-tell-the-difference-between-a-hobby-and-a-business-for-tax...
