Which of the Following Is a True Statement

question 53

Multiple Choice

Which of the following is a true statement?

• A) Expenses associated with a "hobby" are never deductible.
• B) The deductibility of an activity's expenses in excess of revenues depends upon whether the activity is primarily profit-motivated or a hobby as determined by facts and circumstances.
• C) Taxpayers engaged in a "hobby" are always presumed to be motivated by profit.
• D) The regulations do not provide any guidance for determining whether an activity is profit motivated.
• E) All of the choices are true.

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Definitions:

ATP

A molecule known as adenosine triphosphate, which serves as a carrier of energy inside cells for metabolic processes.

Galactose

A simple sugar (monosaccharide) that, together with glucose, forms the disaccharide lactose; important in energy metabolism and found in dairy products.

Glucose

An elementary sugar critical for energy in living organisms and a key element of many carbohydrate compounds.

Principle Sugar

The primary type of sugar that is prevalent or most important within a particular context, such as glucose in human blood.