Paying Tax on a hobby

tann · Apprentice Joined: 13 Jun 2006 Posts: 4

Hello, there! My name’s Todd from Ohio and I would really be grateful to anyone who could answer my question. Yesterday, while my friends were here for dinner we started an interesting topic- tax. We talked about rates, obligatory rates and staff connected with it. Then one friend said that if you had a hobby, you had to pay taxes for it, and, I must say, I got lost. So we made a bet. Now I’m stuck and can’t prove who was right. Do you know anything about this? Thanks very much

evangeline · Apprentice Joined: 17 Jun 2005 Posts: 3

Hi, Todd! Well, this is how the story goes. As far as know, if you make money from your hobby, you may deduct the sum of money you spend on it from the sum of money you receive from it. It’s because this hobby of yours presents a source of income and that’s the rule. So in this case, I must say that your friend was right. On the other hand, if the hobby is just a nice way to spend your free time, I can’t think of a reason why you should be given a tax reduction for it. It doesn’t sound logical, at all! So it depends on the type of hobby both of you had in mind. Hope you win the bet!