I have an elderly client that has been running schedule C losses for at least the past 6 years, the thought being that his business should now (and most likely should have been a few years ago) be classified as a hobby.  In addition, section 179 auto depreciation was claimed in 2021, with usage of this auto dropping below 50% for 2023.  My understanding is that hobby expenses are reported on schedule A, only to the extent of hobby income, with hobby income being reported on schedule 1.  However, the form 4797 Part IV recapture is creating other income on schedule C, which is generating SE tax even though our position is that it is now a hobby.  It seems a disparity to have SE tax generated on hobby activity, however, I have not found an alternative method for reporting the section 179 recapture.