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ntfteam2
New Member

I am trying to become a professional angler and have won several tournaments. I have a full time job only to allow me to pursue this goal. Can I use this as a business?

 
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Accepted Solutions
Coleen3
Intuit Alumni

I am trying to become a professional angler and have won several tournaments. I have a full time job only to allow me to pursue this goal. Can I use this as a business?

The work you perform for a W-2 employer is never your own business. Your business could potentially be as an angler if you have income and a profit motive to that end. Income and expenses would be reported on Schedule C Profit or Loss from business. If this is not a business, then it is hobby income and expenses.

Here are some of the factors taken into consideration.

Business or Hobby? Answer Has Implications for Deductions
  • Does the time and effort put into the activity indicate an intention to make a profit?
  • Does the taxpayer depend on income from the activity?
  • If there are losses, are they due to circumstances beyond the taxpayer’s control or did they occur in the start-up phase of the business?
  • Has the taxpayer changed methods of operation to improve profitability?
  • Does the taxpayer or his/her advisors have the knowledge needed to carry on the activity as a successful business?
  • Has the taxpayer made a profit in similar activities in the past?
  • Does the activity make a profit in some years?
  • Can the taxpayer expect to make a profit in the future from the appreciation of assets used in the activity?
  • https://www.irs.gov/uac/business-or-hobby-answer-has-implications-for-deductions

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1 Reply
Coleen3
Intuit Alumni

I am trying to become a professional angler and have won several tournaments. I have a full time job only to allow me to pursue this goal. Can I use this as a business?

The work you perform for a W-2 employer is never your own business. Your business could potentially be as an angler if you have income and a profit motive to that end. Income and expenses would be reported on Schedule C Profit or Loss from business. If this is not a business, then it is hobby income and expenses.

Here are some of the factors taken into consideration.

Business or Hobby? Answer Has Implications for Deductions
  • Does the time and effort put into the activity indicate an intention to make a profit?
  • Does the taxpayer depend on income from the activity?
  • If there are losses, are they due to circumstances beyond the taxpayer’s control or did they occur in the start-up phase of the business?
  • Has the taxpayer changed methods of operation to improve profitability?
  • Does the taxpayer or his/her advisors have the knowledge needed to carry on the activity as a successful business?
  • Has the taxpayer made a profit in similar activities in the past?
  • Does the activity make a profit in some years?
  • Can the taxpayer expect to make a profit in the future from the appreciation of assets used in the activity?
  • https://www.irs.gov/uac/business-or-hobby-answer-has-implications-for-deductions

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