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Not necessarily. If at the time you were operating your business with a true profit motive, it's possible that you would be entitled to deduct a loss for your attempt to earn income in 2017. This could certainly be the case since 2017 was your first year, and you were possibly still learning the ropes of your business. Later, if you wound up pursuing the activity more as a hobby, you'd be correct to report it as a hobby on your 2018 return.

 

The IRS lists nine factors which are used to distinguish between a hobby and a business. Note that one of them is whether your losses are due to circumstances beyond your control (or are normal in the startup phase of your type of business). The IRS looks at the facts and circumstances of each situation. There's no one strict rule for hobby vs business.