Question

reporting business losses

Forum|Forum|1 year ago
March 31, 2025
1 reply
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I'm striving to be a successful fiction writer. I've self-published my third novel via KDP, and I actively marketed it, but nor many sales. How many years can I continue to report losses on my Federal taxes?

V

Vanessa A

Two out of five years. If you claim losses for 3 out of 5 years, the IRS may reclassify your business as a hobby. So depending on how long you have been doing this, you may want to report it as a hobby if you receive income instead of a business.

When the IRS Classifies Your Business as a Hobby

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