4 Benefits of Using Accounting Software for Your Small Business
Is Your Sideline Activity a Business or a Hobby?
Do you have a sideline activity that you think of as a business?
From this sideline activity, are you claiming tax losses on your Form 1040? Will the IRS consider your sideline a business and allow your loss deductions?
The IRS likes to claim that money-losing sideline activities are hobbies rather than businesses. The federal income tax rules for hobbies have been anti-taxpayer for years, and now an unfavorable change enacted in the Tax Cuts and Jobs Act (TCJA) made things even worse for 2018-2025.
If you have such an activity, we should have your attention.
Here’s the deal: if you can show a profit motive for your now-money-losing sideline activity, you can classify that activity as a business for tax purposes and deduct the losses.
In this article, we give you what you need to know about the federal income tax rules for hobbies and how to tilt the playing field in your favor.
Bitcoin Is On The Move Again
Last month, Visa announced they are partnering with cryptocurrency startup BlockFi to offer a credit card that rewards purchases with Bitcoin rather than airline miles or cash. Earlier in 2020, Coinbase and Visa announced a Coinbase Card, which allowed users to spend Bitcoin using the Visa debit card. If you’re not familiar with cryptocurrency, this would mean that your rewards are more valuable than ever before.
Emergency Preparedness
It’s the time of year when Spring is in full swing, children are excited about summer, grads are making plans for the future. It’s also the time of year when the weather can change rapidly, not always for the best. Having grown up in the south, I am accustomed to severe weather changes and I’ve seen the damages and personal loss caused by flooding, hail, and tornados. For small business owners, being prepared can mean staying in business following a disaster.