 | Christopher W Merchant
is a C.P.A. with over 30 years experience in all aspects of tax preparation, accounting and business valuations. Chris is a member of The American Institute of Certified Public Accountants and the National Association of Certified Valuation Analysts. In addition to his private practice, he opened Liberty Tax Service with his sister Kelly Carpenter in January 2001. Liberty Tax Service is located in Towne West Square and offers high quality tax returns as well as refund anticipation loans in which clients can receive their refunds in 24 to 48 hours. For more information, you may contact Liberty Tax Service by phone at (316) 219-4829 or Chris at (316) 744-9181. Chris graduated from Wichita State University in 1970 and lives in Wichita with his wife Debra and children Andrew and Jamie. |
Taxes & Accounting
2003-08-01 13:57:00
What constitutes a business versus a hobby?
ANSWER: When a business involves personal pleasure or recreation, the IRS may take notice. Although certain activities are more susceptible to the hobby loss taint, (e.g., auto racing; gentleman farmer or rancher; horse or dog racing, breeding, or showing), no activities are immune. If the business generates losses that offset income from other sources, a taxpayer should consider all the facts and circumstances before deciding to deduct the losses. The IRS will consider nine factors to determine whether the activity is a hobby. The nine factors to be considered are:
