If you have a side business you generate revenue with, make sure you treat it as a business. Make sure you had a profit in three out of the last five years and operate the side business as a business. If the IRS decides it is a hobby, you can lose deductions and possibly be subject to the Alternative Minimum Tax on the gross income of the hobby. Here is a link to the IRS website discussing a hobby versus a buinsess:
http://www.irs.gov/newsroom/article/0,,id=169490,00.html
If you have any questions, call me at 818-317-6035 or email me at bstonercpa@sbcglobal.net and we can talk about it.
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