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Is My Blog a Business or a Hobby?

Is my blog a business or a hobby? How to decide come tax time.

We are diving into another blog bookkeeping topic today!  In the blogging world, there is a lot of talk about monetization.  Everyone likes making money.  Some people blog with the express interest in making a profit, while others view it as a happy bonus if they make some extra cash.  Does how you run your blog matter?  Well on a blog level no, it is up to you.  But come tax time yes.  It does matter.  Hobbies and businesses have different tax requirements.  So the question is then: Is my blog a business or a hobby?

Is my blog a business or a hobby? Questions to ask for tax time.

Is My Blog a Business or a Hobby?

The short answer to this question is: What do you think you are?  Do you see yourself as just something you are doing for fun and as an outlet?  Or are you looking to turn a profit?  Yes, how you see your blog is important.  Just because you make a little bit of money doesn’t mean that you are running a business.  Hobbies can make money.  Someone who knits could sell something they made to a friend, but if they aren’t looking to make a consistent profit off of their knitting that could be considered hobby income.  Conversely not making any money doesn’t mean you aren’t a business.  Most businesses take a couple of years to turn a profit.  Not making a profit alone doesn’t disqualify you from taking business deductions.  What if you aren’t sure what you are yet?  Fortunately, the IRS does give some guidelines on how to determine if you are a hobby or a business.  Where to go to get all the blogging tax help you need.  Easy to understand explanations and best practices for running your money making blog.

Good News!  I know that bloggers have a ton of questions about the tax and business side of running a blog.  It’s a small business after all.

To help out I have a new resource for all things blogging and taxes:

This site has everything you need to know about filing your taxes as a blogger.  It has easy to understand explanations along with best practices for running your small business.  

Are you a business?

There are several questions to ask yourself to determine if you are a business or not, but they boil down to a few main ideas:

  1. Are you actively trying to make a profit?
  2. Do you depend on the activity as a source of income for your family?
  3. If you have losses, are they in the start-up phase?  Or are they from something you couldn’t control?
  4. Are you working to improve profitability?  Are you trying to make more money?
  5. Has your activity made money in the past?

If you have made money off of your activity in 3 of the past 5 years (including the current year) the IRS generally assumes you are a for-profit enterprise.

Why should I care?

Why does this matter?  Who cares if you are just blogging as a hobby or if you are trying to make it a business.  It matters for everyone’s tax favorite: Deductions.  If you are a hobby you can only take deductions up to the amount you made in profit.  If we go back to our knitting example that means if you sell something you made you can take deductions (like yarn supplies) up to the amount of money you made.  You can’t deduct all the yarn you bought for the whole year.  If you are a business you can deduct more than the amount you made.  (Hobby income and business income are also reported on different forms.)

How do I prove I’m a business?

I think we all know that a lot of business don’t turn a profit right away.  And you can happily blog away without ever making a cent or even trying to.  So how do you prove you are a business?  The short answer is you act like one.  How do you act like a business?  There are a few things you can do.

  1. Have a business plan or a plan of action for how to make a profit.
  2. Operate as a business with things like maintaining proper record keeping, having appropriate government registrations as needed, and having things like business cards, websites, social media postings, etc.  (This is where my easy blog bookkeeping organization system comes in handy!)
  3. Form an LLC or corporation.  (Note: You do not need to do this to be a business, especially as a blogger.  It is just an option.)
  4. Have separate bank account if necessary.
  5. Spend the time and document that time spent working to make a profit. Document progress towards your profitability goals.

What it really comes down to is whether you intend to make a profit and if you are actively working towards making a profit.  Like I said, if you think you are a business and are acting like you, you are a business.  Within different industries, you will find hobbyists and businesses.  With our knitting example there are people who knit for fun and occasionally sell a piece, and then there are those who knit hard and sell a ton.  Blogging is no different.  Some people blog for enjoyment and every so often they make a little money.  Some people set a goal to make a profit and then work towards that goal.

Is my blog a business or a hobby? Come tax time you will want to know. Here are some tips to determine how to classify your blog for tax purposes..


I can’t tell you if you are a business or a hobby, and I am not trying to do that here.  These are just some tools to find out where your blog falls.  Like all things having to do with accounting, you need to talk to your tax professional to decide what is best for you and your blog.  But if you want to be considered a business you need to be documenting how you are running your operation and be actively working to make money.  You have to put in the work of a business to be considered a business.


IRS Business or Hobby Fact Sheet

IRS Tax Tips for Hobbies That Earn Income

Turbo Tax Hobby or Business Fact Sheet

How To Organize Your Blog Bookkeeping

Home Office Deductions for Bloggers

15 Tax Deductions for Bloggers

Is my blog a business or a hobby? This seems like a simple enough question, but there are big implications come tax time. How do you claim your blog income? Learn how to decide where you fall. #blogtaxes #income #hobbyblog #businessblog #taxtips

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Stella Nadene

Wednesday 20th of September 2017

I was actually JUST thinking about these questions today!! Great post, makes me in a better place to think about these things in terms of taxes.

Shannon M

Monday 18th of September 2017

This is a post I really needed...totally in that phase where I'm trying to figure out what the heck I'm doing! Thanks for pushing me just a little bit further.

Darlene Dee

Monday 18th of September 2017

This is a GREAT post. And yet I still don't know the answer. I think I am blogging as a hobby, but I just signed up for the Target affiliate program. Mostly out of curiosity, though. Does that mean I am a business, because that is sort of actively trying to make money?


Wednesday 20th of September 2017

Thank you. The annoying answer to your question is still, it depends. Setting up a chance for money to come in alone doesn't mean you are a business. For example, you can participate in an MLM just to get the discounts and sometimes sell something, but not make it a business. Or you can go gung-ho and host parties, advertise and try to make real money off of it. Blogging is the same. You can put some links out there just to see if you get anything, not really promoting them or using them as income to support your family. If you make some money awesome. That is hobby income. Or you can put affiliate links out there, promote them, and include them in your profit generating plan. That is more of a business strategy. Basically, you need to look at your activities as a whole, not just one part to determine if you are a business or a hobby.


Monday 18th of September 2017

This is helpful information. I currently maintain two blogs but neither are making an income. The first one I would suppose is a hobby but the second one is to establish a business and my brand. And I like how you mentioned not making money doesn't mean you're not running a business. It makes perfect sense the first several months even up to a year, a business doesn't make a profit.


Monday 18th of September 2017

That's really to the point, a great post, and i agree about the separates account that it will be more easy to organized. Thanks for sharing this.

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