THE SUNLIGHT TAX BLOG:

Tax and Money Education for Creative People, Freelancers and Solopreneurs

Sunlight Podcast Hannah Cole Sunlight Podcast Hannah Cole

Business vs. Hobby & the IRS 9 Point Test for Profit Motive

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Business vs. Hobby & the IRS 9 Point Test for Profit Motive

Today, I’m talking about the tax laws related to distinguishing between a hobby and a legitimate business when you’re a creative professional. I’m also explaining the IRS's view of profit motive as the key factor and discussing how you can determine whether you have a business or hobby.


Join me in this episode to get some advice and tips on how you can prove profit motive and avoid being wrongly classified as a hobby by the IRS.

LISTEN AND SUBSCRIBE HERE

Today, I’m talking about the tax laws related to distinguishing between a hobby and a legitimate business when you’re a creative professional. I’m also explaining the IRS's view of profit motive as the key factor and discussing how you can determine whether you have a business or hobby.


Join me in this episode to get some advice and tips on how you can prove profit motive and avoid being wrongly classified as a hobby by the IRS.

Also mentioned in today’s episode: 

  • Why profit motive is so important 5:35

  • The IRS’s nine-factor test for determining if a creative hobby is a business 19:35

  • The hobby loss rule and how it’s applied 33:07

If you enjoyed this episode, please rate, review and share it! 

Links:

IRS audit technique guide: https://www.irs.gov/pub/irs-pdf/p5558.pdf

https://www.irs.gov/newsroom/heres-how-to-tell-the-difference-between-a-hobby-and-a-business-for-tax-purposes

The Sunlight Podcast Episode 67: Your Business Already Started

An Audit Nightmare Turned Artist Victory: An Interview with Susan Crile

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Perfectionism as a Creative Entrepreneur

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Perfectionism will Kill You

Most creative people are motivated to make incredible work. We might even strive for perfection.

In this episode, I’m talking about how perfectionism is actually holding you back as a creative entrepreneur. I share a vulnerable story about my own perfectionism, talk openly about real fears you may be having, and some actionable ways you can get past them, and get the most out of your money and keep moving forward. I’m also sharing how the topic of perfectionism relates specifically to the IRS (guess what? The IRS doesn’t ask you to be perfect!), to your estimated quarterly taxes, and why you should stop worrying about being perfect when it comes to your taxes.

Listen & subscribe on your favorite platform

Most creative people are motivated to make incredible work. We might even strive for perfection.

In this episode, I’m talking about how perfectionism is actually holding you back as a creative entrepreneur. I share a vulnerable story about my own perfectionism, talk openly about real fears you may be having, and some actionable ways you can get past them, and get the most out of your money and keep moving forward. I’m also sharing how the topic of perfectionism relates specifically to the IRS (guess what? The IRS doesn’t ask you to be perfect!), to your estimated quarterly taxes, and why you should stop worrying about being perfect when it comes to your taxes.

Also mentioned in today’s episode: 

  • Understanding the balance between doing good work and 

  • How a desire to good do work relates to perfectionism in the art world

  • My personal story of perfectionism 

  • Why you should stop trying to be perfect when it comes to your taxes 

  • How perfectionism will mess up your estimated quarterly taxes

  • What the IRS really cares about 

If you enjoyed this episode, please rate, review and share it.

Links:

https://go.sunlighttax.com/register

https://www.sunlighttax.com/deductionsguide

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