Jim:
Technically, the actual term is "an activity not engaged in for
profit". The presumption is that the activity is a business if the
activity generates a profit for two years out of five (seven in the case
of activities involving horses, such as horse racing or breeding).
The presumption can be overcome if the taxpayer can demonstrate an
intent to generate a profit. The case law if full of examples where the
taxpayer prevailed, even though they failed the two out of five (seven)
year test.
A medical expense is deductible if the expense is incurred for the
"diagnosis, cure, mitigation, treatment, or prevention of disease or for
the purpose of affecting any structure or function of the body".
I am currently researching the tax implications regarding the care and
treatment of Zuikoholicism. My initial reaction is that we are indeed a
bunch of sick b*st*rds!
Bill Stanke, CPA
"W. J. Liles" wrote:
>
> Jim Brokaw wrote:
> -- snip ---
> > >
> >
> > The IRS says if you don't make money at it three years out of five its a
> > hobby... I'm into 25 years and haven't made a cent... its a hobby!
> > --
> >
> > Jim Brokaw
>
> That may be the IRS opinion but, medically speaking, it's an addiction.
<snip>
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