Many people have hobbies - things they enjoy doing in their spare time - and some even make a little extra money from them. However, there’s a difference between a hobby and a business, especially how each is treated when it comes to filing taxes.
Businesses operate to make a profit while hobbies are for pleasure or recreation. Here are some common questions people should ask themselves when deciding if what they’re doing is a hobby or business. No single thing is the deciding factor.

Questions to help taxpayers decide if they have a hobby or business

• Is there an intent to make a profit?
• If the activity makes a profit, how much is it?
• Can they expect to make a future profit from the appreciation of the assets used in the activity?
• Do they depend on income from the activity for their livelihood?
• Are any losses due to circumstances beyond their control or are the losses normal for the startup phase of their type of business?
• Are operations adjusted to improve profitability?
• Is the activity carried out like a business with complete and accurate books and records kept?
• Do the taxpayers and their advisors have the knowledge needed to carry out the activity as a successful business?

Taxpayers should review all the factors to make the best decision. Regardless of the decision, if they’re paid through payment apps for goods and services during the year, they may receive an IRS Form 1099-K for those transactions. These payments are taxable income and must be reported on federal tax returns.
Additionally, if they received payment in the form of digital assets, they may also get a Form 1099-DA. Whether taxpayers have a hobby or run a business, good recordkeeping throughout the year will help when they file taxes.

IR-2026-67, May 27, 2026

WASHINGTON — The Internal Revenue Service today announced it will offer Saturday hours at select Taxpayer Assistance Centers on May 30.

TACs will be open from 9 a.m. to 4 p.m. to provide in-person assistance on a range of tax issues.

During this one-day event, TACs in multiple states, the District of Columbia, and Puerto Rico will offer many of their regular services. The IRS encourages taxpayers to visit IRS.gov/SaturdayHours ahead of time to confirm participating locations and available services before heading to an office.

TACs will offer most of their typical services during these hours. However, they will not accept cash payments. The IRS plans to continue offering these Saturday service opportunities through June.

Announcement 2026-07 provides that IRS and the Treasury Department anticipate that certain portions of future final regulations relating to required minimum distributions under section 401(a)(9) will apply for the distribution calendar year that begins no earlier than 6 months after the date that final regulations are issued in the Federal Register. In the interim, the Announcement states that taxpayers must apply a reasonable good-faith interpretation of the statutory provisions underlying the regulations.

Announcement 2026-07 will be in IRB:   2026-11, dated: March 9, 2026.

Mistakes and errors can happen, but most are easily avoidable when it comes to filing federal income tax returns. Taxpayers are encouraged to review their entire return before filing to make sure it is correct and complete. This is the case even if someone else prepared it, because ultimately, it’s the taxpayer’s responsibility to ensure the information on the return is accurate.

Here are just a few common errors that can be avoided:

• Filing too soon: Most tax documents should have been received by now, but taxpayers need to be sure they have all their tax reporting documents before filing. The fastest and easiest way for taxpayers to view their tax records is by logging on to their IRS Online Account.
• Incorrect filing status: Be sure to select only one filing status and make sure it is the correct one. What is my filing status? can help with the determination.
• Inaccurate information: Taxpayers should carefully when entering any wages, dividends, bank interest and other income they receive to make sure they report the correct amounts.
• Misspelled names or missing social security numbers: All names and taxpayer identification numbers must be provided for everyone listed on the return. Social security numbers and names should be entered exactly as they appear on each person’s Social Security card. If there have been any name changes, be sure to contact the Social Security Administration at SSA.gov or call them at 800-772-1213.
• Credits and deductions: There are several new deductions and changes to certain credits for 2026. Taxpayers should make sure any deductions and credits are calculated correctly, and necessary documentation is provided.
• Unsigned return: An unsigned return is considered invalid. If it’s a joint return, both must sign and date. However, exceptions may apply for members of the armed forces or other taxpayers who have a valid power of attorney.
• Incorrect bank account information: Taxpayers who are owed a refund should choose direct deposit. This is the fastest way for them to get their money. However, taxpayers need to make sure they use the correct routing and account numbers on their tax return.

Submitting tax returns electronically ensures greater accuracy. The e-file system often detects common errors and rejects a tax return, sending it back to the taxpayer for correction. This could reduce or eliminate delays in processing a federal tax return. For information on filing, see File your tax return.

Notice 2026-7 provides interim guidance regarding the application of the corporate alternative minimum tax (CAMT) under §§ 55, 56A, and 59. Section 3 of this notice modifies the interim guidance provided in section 4 of Notice 2025-49 and addresses an adjustment to adjusted financial statement income (AFSI) for tax deductible repairs with respect to section 168 property.  Section 4 of this notice modifies the interim guidance provided in section 9 of Notice 2025-49 and addresses an adjustment to AFSI for § 197 amortization attributable to certain intangibles.  Section 5 of this notice addresses an adjustment to AFSI for amortization of domestic research or experimental expenditures.  Section 6 of this notice addresses an adjustment to AFSI for certain production costs attributable to film, television, live theatrical, and sound recording productions.  Section 7 of this notice addresses an adjustment to AFSI for certain low acquisition cost tangible property treated as materials and supplies.  Section 8 of this notice clarifies and modifies the interim guidance for financially troubled companies provided in section 4 of Notice 2025-46.  Section 9 of this notice modifies the anti-abuse rule in proposed § 1.56A-4 that would apply to certain covered asset transactions.  Section 10 of this notice addresses certain CAMT consequences of transactions involving intangible property subject to § 367(d).  Section 11 of this notice provides the applicability dates and requirements for reliance. 

WILL BE IN IRB: 2026-11             DATED: March 9, 2026

There are several new tax deductions that have been introduced for the 2026 filing season. A deduction is an amount subtracted from the taxpayer’s income when filing. Deductions lower the taxable income resulting in lowering the federal income tax obligation.

New deductions for 2026 filing season

• Seniors age 65 and older may be eligible to claim an additional $6,000 deduction
• Tipped workers may be eligible to deduct up to $25,000 for qualified tips
• Individuals may be eligible to deduct up to $12,500 ($25,000 for joint filers) for qualified overtime
• Individuals may deduct up to $10,000 in qualified passenger vehicle loan interest

All new or enhanced deductions are available for both itemizing and non-itemizing taxpayers. Each of these deductions phase out based on income level for individual and joint filers and have specific eligibility requirements. This information can be found on the One, Big, Beautiful Bill provisions page for individuals and workers.

Standard deduction amounts for tax year 2025
The standard deduction is a flat amount based on federal income tax filing status (single, married filing separately, married filing jointly, head of household, or qualifying surviving spouse). The IRS adjusts the standard deduction annually for inflation.

• $15,750 for single or married filing separately
• $31,500 for married couples filing jointly or qualifying surviving spouse
• $23,625 for head of household

Most people take the standard deduction. However, some may not be eligible to take it or if deductible expenses and losses are more than the standard deduction, taxpayers have the option to itemize deductions. Itemized deductions are subject to certain dollar limitations. They can include amounts paid during the taxable year for: state and local income or sales taxes, real property taxes, personal property taxes, mortgage interest, disaster losses, gifts to charities, certain gambling losses, and medical and dental expenses.

Taxpayers are reminded that they need documents to show expenses or losses they want to deduct. Tax software will calculate deductions and enter them in the right forms. Taxpayers who earned less than $89,000 in 2025 can use Free File guided tax software to prepare and electronically file their 2025 federal income tax returns for free. All taxpayers can use Free File Fillable Forms regardless of income level. The IRS Interactive Tax Assistant can help a person decide if they're eligible for many popular tax credits and deductions.

IR-2026-20, Feb. 3, 2026

WASHINGTON — The Department of the Treasury and the Internal Revenue Service today issued proposed regulations for domestic producers of clean transportation fuel to determine their eligibility for and calculate the clean fuel production credit under the One, Big, Beautiful Bill. The new law made important changes to what is often referred to as the 45Z credit.

The clean fuel production credit provides businesses an income tax credit for clean transportation fuel produced domestically after Dec. 31, 2024, and sold by Dec. 31, 2029. To claim the credit, taxpayers must be registered with the IRS using Form 637, Application for Registration (For Certain Excise Tax Activities) at the time of production.

The proposed regulations provide guidance on the determination of clean fuel production credits, emissions rates, and certification and registration requirements. They provide further certainty and clarity for taxpayers and address key issues raised by stakeholders.

What’s new under the OBBB

Today’s guidance also proposes rules to implement certain OBBB changes to the clean fuel production credit. OBBB changed the clean fuel production credit to:

• Extend the credit to Dec. 31, 2029;
• Limit feedstocks to those grown or produced in the US, Mexico, or Canada;
• Add prohibited foreign entity restrictions;
• Broaden sale attribution for fuel sold through related intermediaries;
• Eliminate the special rate for sustainable aviation fuel;
• Add an anti-abuse provision to prevent double crediting;
• Prohibit negative emissions rates except for fuels derived from animal manure;
• Require feedstock-specific emissions rates for fuels derived from animal manure; and
• Exclude indirect land use changes from emissions rates.

Treasury and IRS invite public comments

Treasury and IRS welcome comments and requests to speak at the public hearing on these proposed regulations. Commenters are encouraged to use the Federal e-Rulemaking portal to submit comments (indicate “IRS” and “REG-121244-23”). A public hearing has been scheduled as described in the “Comments and Public Hearing” section. Paper submissions should be sent to: CC:PA:01:PR (REG-121244-23), Room 5503, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. 

For more information, see One, Big, Beautiful Bill Provisions on IRS.gov.

WASHINGTON — The Internal Revenue Service announced today the award of $53 million in Tax Counseling for the Elderly and Volunteer Income Tax Assistance grants to organizations that provide federal tax return preparation at no cost.

This year, the IRS awarded grants to 48 TCE and 315 VITA applicants. The IRS received 479 applications requesting over $79 million in funding.

“These grants ensure that VITA and elderly tax-counseling organizations have sufficient funding to provide assistance to individuals in need at local centers across the nation,” said Chief Executive Officer Frank J. Bisignano. “The IRS recognizes the important work these organizations do and salutes their efforts.”

The TCE program, established in 1978, provides no-cost tax counseling and federal return preparation to individuals who are age 60 or older. Volunteers receive training and technical assistance to help at community locations across the nation.

The VITA program, created in 1969, assists underserved communities, such as low- and moderate-income individuals and limited English proficient taxpayers. VITA grant recipients provide no-cost federal tax return preparation and electronic filing. The grant program helps to expand VITA services to underserved populations.

The IRS maintains partnerships with a wide variety of organizations across the country to develop VITA and TCE programs. Community partners include non-profit agencies, faith-based organizations, community centers and large employers. The IRS provides tax law training, certification and oversight to these organizations, assisting their efforts to prepare accurate returns.

For information on applying for the TCE or VITA programs visit Tax Counseling for the Elderly or IRS VITA Grant Program on IRS.gov. A current list of grant recipients will be available on these pages beginning January 31, 2026. For details on becoming a TCE or VITA volunteer, visit IRS Tax Volunteers.

IR-2026-13, Jan. 27, 2026

WASHINGTON — The Internal Revenue Service today issued frequently asked questions in Fact Sheet 2026-02 to help taxpayers, businesses, and other stakeholders understand the changes under Executive Order 14247: Modernizing Payment To and From America’s Bank Account.

“These FAQs support the Executive Order in its effort to reduce fraud, improve security, lower costs, and make payments to and from the IRS faster and more reliable," IRS Chief Executive Officer Frank J. Bisignano said.

Background

The U.S. Department of the Treasury, in collaboration with the IRS and other federal agencies, is transitioning federal payments to and from the government to electronic methods pursuant to Executive Order 14247, signed March 25, 2025. 

These changes apply to:

• Payments sent by the federal government, including tax refunds, benefits, grants, and vendor or contractor payments; and
• Payments made to the federal government, including tax balances due, fees, penalties, and other payments from individuals, businesses, nonprofit organizations, and state or local partners.

Electronic payments are generally processed faster, cost less to handle, and reduce errors compared to paper payments. Limited exceptions to electronic payment requirements will be available in specific situations, such as those involving hardship and/or legal or procedural requirements.

Filing tax returns is not changing

The Executive Order does not change how taxpayers file their tax returns. Taxpayers will continue to file their returns in the same manner as they have in the past. The change affects how refunds are issued and how payments are made, not how returns are prepared or submitted, beginning with the 2026 filing season. For now, checks and money orders will still be accepted. 

What taxpayers should do now

To prepare for these changes, the IRS encourages taxpayers to:

• Use direct deposit for refunds by providing accurate bank or prepaid debit card information when filing.
• Choose electronic payment options when paying taxes, such as IRS Direct Pay, Electronic Federal Tax Payment System, or other approved methods.
• Review account information to ensure bank details are current and correct.
• Visit IRS.gov to learn about electronic payment options and available resources for taxpayers without a bank account.

For more information about how the IRS is implementing the Executive Order, visit Modernizing Payments To and From America’s Bank Account on IRS.gov.

One, Big, Beautiful Bill: How to take advantage of no tax on tips and overtime

The One, Big, Beautiful Bill has a significant effect on federal taxes, credits and deductions. Millions of taxpayers reported earning tips and overtime on their tax returns, many of them are veterans and people working in lower wage jobs. This relief will impact most of these taxpayers and they can start taking advantage of the deduction this filing season.

No tax on tips
Employees and self-employed individuals may deduct qualified tips received in certain qualified occupations, such as wait staff, bartenders, salon workers, personal trainers, gig economy workers, and many more who customarily and regularly receive tips might qualify.

Even better, tips earned on or before December 31, 2024, and are reported on a Form W-2, Form 1099, or other statement furnished to the individual or reported directly by the individual on Form 4137 can be deducted.

• “Qualified tips” are voluntary cash or charged tips received from customers or through tip sharing
• Maximum annual deduction is $25,000; for self-employed, deduction may not exceed individual’s net income, without regard to this deduction, from the trade or business in which the tips were earned
• The deduction phases out for taxpayers with modified adjusted gross income over $150,000 ($300,000 for joint filers)

To see examples of how “no tax on tips” is calculated, taxpayers should review this news release.

No Tax on Overtime
Individuals who receive qualified overtime compensation may deduct the pay that exceeds their regular rate of pay, generally, the “half” portion of “time-and-a-half” compensation, that’s required by the Fair Labor Standards Act and reported on a Form W-2, Form 1099, or other specified statement furnished to the individual.

• Maximum annual deduction is $12,500 ($25,000 for joint filers)
• Deduction phases out for taxpayers with modified adjusted gross income over $150,000 ($300,000 for joint filers)
• The deduction is available for both itemizing and non-itemizing taxpayers