Hobbies may become businesses if they are conducted in a businesslike manner

Article Abstract:

Losses from hobbies are only deductible to the extent of any income derived from hobby activities, whereas business losses are fully deductible. Court decisions have usually emphasized the taxpayer's profit motives when distinguishing between hobbies and businesses. There are a number of guidelines for determining whether or not there is a profit motive behind a taxpayer's activity. These include: the manner in which the activity is conducted, the expertise of the taxpayer or his advisors, the time and effort that the taxpayer spends on the activity, the appreciation of assets used in the activity, prior successes of the taxpayer, the amount of profits from the activity in relation to the taxpayer's investment, the financial status of the taxpayer, and the amount of pleasure or recreation derived from the activity. The Tax Reform Act of 1986 has imposed new restrictions on the deductibility of miscellaneous expenses.

Hobbies

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Moving expense deductions and reimbursements: a practical application of the rules

Article Abstract:

Deductibility rules concerning moving expenses are extensive. A move must be related to start of work at a new location. Deductible direct moving expenses include the costs of moving household goods and personal effects, and the travel costs involved in going from the old to the new residence. Indirect moving expenses include house-hunting expenses, temporary living expenses, and expenses from qualified residence sale or purchase. Reimbursements of moving expenses must sometimes be included in income.

Moving, Household, Household moving

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