Gary Is an Architect Who Also Sings at Weddings

question 81

Multiple Choice

Gary is an architect who also sings at weddings. This year, he received $5,400 in fees for his singing and spent $6,250 on voice lessons, sheet music, and travel to the weddings. Which of the following statements is true?

• A) Because the singing activity resulted in a loss, Gary can't treat it as a business.
• B) If facts and circumstances support Gary's claim that his singing activity is a business, he can deduct an $850 above-the-line loss.
• C) Because Gary's primary source of income is his architecture practice, he can't treat the singing activity as a business.
• D) Gary can deduct his $850 hobby loss as an itemized deduction.

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Definitions:

Family

A social unit consisting of parents and their children, considered as a group, whether dwelling together or not; often extends to include relatives.

Customer Service

Assistance and advice provided by a company to those people who buy or use its products or services.

Frontline Employees

Workers who directly interact with customers, representing the face of the company and playing a critical role in customer service.

Pay Incentive

A financial or material reward provided to employees as a means to increase productivity, motivation, or achieve specific business outcomes.