Skip to main content
March 8, 2025
Solved

I work a full time job and receive a W2. I do real estate on the side and have not received any income for year 2024. Do I have to file as a business?

  • March 8, 2025
  • 1 reply
  • 0 views
I did have one sale for the year 2023. However, Turbotax is telling me to file business taxes for this year despite me not having any income for the year 2024. Can I deduct my expenses that keep my license active or can I forgo them altogether since I have no income from real estate this year?
    Best answer by AnnetteB6

    You need to consider your intentions for the real estate business.  If you are keeping your license active as a hobby just in case something comes along, then you should not report those expenses on Schedule C to create a business loss since there was no income in 2024.  

     

    But, if you are continuing to operate your real estate business in a businesslike manner with the intent to generate income and you just did not have any success in 2024, then you could include those expenses on Schedule C.  

     

    In order to continue to report expenses exceeding income on a Schedule C, the rule of thumb with the IRS is that you must show a profit in two of five years.  Otherwise, the business is considered a hobby.  

     

    To learn more, take a look at the following TurboTax help article:

     

    When the IRS Classifies Your Business as a Hobby
     

    1 reply

    AnnetteB6Answer
    March 8, 2025

    You need to consider your intentions for the real estate business.  If you are keeping your license active as a hobby just in case something comes along, then you should not report those expenses on Schedule C to create a business loss since there was no income in 2024.  

     

    But, if you are continuing to operate your real estate business in a businesslike manner with the intent to generate income and you just did not have any success in 2024, then you could include those expenses on Schedule C.  

     

    In order to continue to report expenses exceeding income on a Schedule C, the rule of thumb with the IRS is that you must show a profit in two of five years.  Otherwise, the business is considered a hobby.  

     

    To learn more, take a look at the following TurboTax help article:

     

    When the IRS Classifies Your Business as a Hobby
     

    **Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"