Sidewinder
New member
If someone has not made a profit three years in a row, I understand that it is a flag to the IRS that it is a hobby and back taxes and penalties will need to be paid on the previous income. Question is this: Is it illegal to not declare expenses (i.e., tax write-offs, thereby giving the government their share of the taxes)? That way, a profit is shown (and taxes are paid) even if the profit is not real - so that the individual does not have to pay back taxes and penalties for previous year gross revenue (even if minimal).