Hi Archie,
I have always loved to debate with you I really don't have the time.

Let's start with a basic premise............
All income from whatever source derived is taxable.

The Internal Revenue Code is nothing more than an exception to this general rule. Whether an individual is engaged in a hobby or a business depends upon ALL THE FACTS AND CIRCUMSTANCES as they pertain to THAT INDIVIDUAL.

The only issue that stems from the hobby vs business question is when a taxpayer uses the
"hobby loss" to reduce other forms of income such as W2 income. If a taxpayer reports all the hobby income and deducts all the hobby expenses and the result is a loss BUT he/she does not utilize that loss as a tax benefit to reduce other income the federal government will GENERALLY leave the area alone.

Best, Jim