Side hustles are everywhere—but not everything that makes money is a “business” in the eyes of the IRS. In this course, we’re breaking down the classic tax identity crisis: Is it a business or just a hobby with a shopping habit? 💅 You’ll learn how to tell the difference, what the IRS looks for (hello, 9-factor test!), and how to report income and expenses without raising red flags 🚩

Learning Objectives

• Distinguish an activity engaged in for profit from a hobby by applying the nine factors in Treas. Reg. §1.183-2(b)
• Determine how hobby income and expenses are reported and how that treatment differs from a trade or business reported on Schedule C
• Identify the income a sole proprietor must report on Schedule C and the documentation required to support it
• Identify ordinary and necessary business expenses deductible on Schedule C and recognize expenses that are limited or disallowed
• Recognize the Schedule C reporting patterns most likely to draw IRS scrutiny and the due-diligence steps that address them