Are You Serious or Just Foolin’ Around – Is it a Business or a Hobby?
You have one year from airing date to use this course as credit.
Continuing Education
CPE Program Knowledge Level: Overview
2 CPE Credit; NO prerequisites or advance preparation
CTEC Course #: 3022-CE-00173
IRS/RPO Approved Program
#7ZBUJ-T-00130-25-O (Online/Group) Live (Group-Internet Based)
#7ZBUJ-T-00130-25-S (QAS Self Study) Archive
Federal Tax Law (2 Hours)
Program Content
This online learning program, presented as a live webcast, will be also archived for QAS Self Study. The program will be available for viewing for 12 months after the live webcast. A panel of IRS and industry experts will present the content during a live, interactive discussion, where participant questions can be submitted. Questions will be answered live on the program or posted on the Resources page.
The program, through a lively round-table discussion and real time interaction with the audience, focuses on what distinguishes a business from more casual activities. The program will explore factors the IRS considers in making the decision on whether an activity is a business or a hobby. Panelists will examine the restrictions on deductions generated by an activity that fails to rise to the level of a business. The discussion will also zero in on the presumption as to whether an activity is a business or not, and the election that allows the taxpayer to extend the time in which that presumption is applied. The panel also will explore some special situations and the tax adjustment and penalties that may apply when a taxpayer incorrectly treats a hobby as a business.
By the end of the program, participants will have a practical understanding, through accurate, current, and effectively designed communications, of the "hobby loss rules" and the distinction between an actual business and an activity that lacks a true profit motive.
Program Learning Objectives
- Identify the IRC section that outlines a non-exhaustive list of factors the IRS considers when determining whether an activity is engaged in for profit or is considered a hobby.
- Identify what type of loss occurs when the market value of an asset (like a stock, bond, or real estate) decreases below its original purchase price, but the asset has not been sold.
- Identify what type of loss occurs when the taxpayer actually sells an asset for less than its original purchase price, resulting in an actual loss of cash.
- Identify the milestone the IRS generally focuses to determine the start date of a business for tax purposes.
Program Outline
Requirements for Deducting Business Expenses
- Profit Motive
- Trade or Business
- Ordinary and Necessary
The Nine Factors
- Manner
- Expertise
- Time and Effort
- Expectation of Appreciation
- Success in Other Activities
- History
- Amounts of Occasional Profit
- Financial Stake
- Personal Pleasure or Recreation
Activity Not-for-Profit (Section 183)
- General Rule
- Allowable Deductions
- Presumption
- Election to Postpone
Special Situations
- Multiple Activities
- Farming and Farmland
Tax Adjustment
- Penalties
Panelists
Moderator
Alan Pinck, EA
A. Pinck & Associates
Alan Pinck is an Enrolled Agent with over 30 years of tax preparation experience in the San Francisco Bay Area. He has built a practice specializing in individual, small business tax preparation and audit representation. You have seen Alan presenting at NTPI events, CSEA Super Seminar, Spidell Publishing as well as a variety of other presentations for tax groups and small business associations. Having represented thousands of tax returns in audit, Alan has obtained tremendous insight of the audit process as well as knowledge on a wide variety of tax issues.
Industry Panelists
Claudia Hill, EA, MBA
Tax Mam, Inc./TMI Tax Services Group, Inc.
Claudia Hill is an Enrolled Agent, nationally recognized tax professional and frequent lecturer on taxation of individuals and representation before IRS. She is Editor in Chief of the WoltersKluwer, (formerly CCH) Journal of Tax Practice & Procedure, co-author of CCH Expert Treatise Tax Practice & Procedure, a founding partner of Tax Genius Learning, and a frequent presenter for both audio and in-person CPE seminars nationwide. Claudia coordinates a "dream team of tax controversy advisors" for the IRS Watch blog on Forbes.com . She was named a Top Ten Nominee by Tax Analysts as 2011 Person of the Year.
Claudia is owner and principal of Tax Mam, Inc. and TMI Tax Services Group, Inc. in Cupertino, CA. TMI Tax Services Group offers tax return preparation, tax planning, and tax problem resolution and representation services, primarily to individual clients. She is often called upon by the news media as a resource person for commentary on tax topics. Her articles and observations have appeared in CCH publications as well as Tax Analysts, Forbes.com and industry professional journals. Her mission to reform or eliminate the individual AMT has been the focus of a number of articles. In March 2005, Claudia was invited to testify about the individual AMT at the President's Tax Reform Panel. Visit her website, www.taxmam.com.
Claudia is an associate member of the ABA Tax Section, a life member of the American Tax Policy Institute, a Fellow and former Dean of the NAEA-EF National Tax Practice Institute. After several years as "Chair," Ms. Hill is now a special advisor to the Government Relations Committee for the National Association of Enrolled Agents. She served on the 1987 Commissioner's Advisory Group to the National Office of the Internal Revenue Service. Ms. Hill holds a Master degree in Business Administration, earned with honors in 1978.
Carlos Lopez, EA
President, Latino Tax Professionals
Carlos Lopez is founder and President of Lopez Tax Service and the Latino Tax Professionals Assocation located in Salinas, California. He holds a Bachelor of Arts from Pacific Union College and a Certificate of Management Development for Entrepreneurs from UCLA Andersen School of Management. He has completed the Stanford Latino Entrepreneur Initiative from the Stanford Graduate School of Business. He has been active in tax preparation and representation before the IRS for more than 36 years. Mr.Lopez has been a lecturer and presenter for the IRS Nationwide Tax Forums.
Content Consultant
David F. Windish, J.D., LL.M
Content Consultant
David F. Windish, J.D., LL.M. in taxation, is a tax attorney and consultant. He has served as an instructor of tax-advantaged investments at the New York Institute of Finance; an Instructor of business law at the U.S. Merchant Marine Academy, Kings Point, N.Y.; and an adjunct professor at George Mason University, Fairfax, Va. He has also served as executive editor for Tax Analysts; managing editor for Business Strategies, published by CCH; and senior editor for the Institute for Business Planning.
Mr. Windish is the author of Practical Guide to Real Estate Taxation, published by CCH and currently going into its sixth edition. Earlier works include Tax Advantaged Investments and Investor's Guide to Limited Partnerships, both published by the New York Institute of Finance. Through the Center for Video Education, he authored continuing education courses dealing with real estate and closely held corporations. Those courses included readings, case studies, and videotape segments.
Mr. Windish is a graduate of Rutgers University Law School and the New York University School of Law, Graduate Division. He has been heard as a guest speaker at professional meetings and seminars and on popular radio programs.