To enter hobby income and expenses in TurboTax
please follow these steps:
- Once in your tax return, click on Federal
Taxes tab
- Choose Wages
and Income
- Scroll down to Less
Common Income and click Start to to right of Miscellaneous
Income, 1099-A, 1099-C
- Click Start to right of Hobby
income and expenses
The
IRS doesn't allow you to deduct hobby expenses directly from hobby income.
Instead, you can deduct expenses as an itemized deduction subject to 2% of your
adjusted gross income. Also, the amount that you claim as an expense cannot be
greater than your income from the hobby. In other words, your hobby cannot
generate a loss.
Taxpayers
can choose to itemize
expenses on their tax returns or take the standard allowable
deduction. Hobby expenses can only be deducted if you itemize your deductions.
If
you don't have any other itemized deductions, TurboTax will deduct the
greater of the standard deduction or itemized deductions. TurboTax will choose
the one that lowers your overall tax liability.
Note: You may need to upgrade to a higher version of TurboTax. TurboTax Deluxe and higher support the reporting of hobby income and expenses.