Hobby Loss Rules
Date: Thursday, May 15, 2025
Instructor: A.J. Reynolds
| Begin Time: |
9:00am Pacific Time
10:00am Mountain Time
11:00am Central Time
12:00pm Eastern Time |
| CPE Credit: |
1 hour for CPAs
1 hour Federal Tax Related for EAs and OTRPs
1 hour Federal Tax Law for CTEC |
|
NOTE: Go to My Professional Profile in your CCH CPELink account settings to ensure your name, and PTIN number; matches your PTIN card
Millions of people enjoy hobbies that are also a source of income. From catering to baking cupcakes, crafting homemade jewelry to wind chimes -- no matter what a person’s passion, we as tax professionals must determine if our client has a business or Hobby.
The rules for how to report the income and expenses depend on whether the activity is a hobby or business.
Sometimes the tax law is so obvious that one need not be an expert to conclude the result of a case. But at times we allow ourselves to be so obscured in details that we can miss the obvious, even in the world of complicated tax law.
This course provides a useful overview of determining if a business venture is a hobby subject to limitations on deductions or if the business venture is truly a trade or business and deductions are fully allowed under IRC Section 162.
Who Should Attend
All Tax Professionals who have clients starting up or currently have businesses
Topics Covered
- Examination the distinction between a dealer (flipper) and an investor
- Discover the Audit Technique Guide
- Examine what is a Trade or Business
- Analyze each of the nine factors of Regulation 1.183-2(b)
- Client Questionnaire regarding their Profit Motive
Learning Objectives
- Extrapolate & Critique the Nine Relevant Factors
- Examine what is a “Trade or Business”
- Explore relevant case law
- Develop a checklist to determine hobby vs Trade or Business
- Formulate a plan on how to prove your client has a trade or business
Level
Basic
Instructional Method
Group: Internet-based
NASBA Field of Study
Taxes (1 hour)
Program Prerequisites
None
Advance Preparation
None
