How to report hobby income and expenses on Form 1040 in ProConnect Tax

In ProConnect Tax, you report gross income from a hobby on Schedule 1 as Other Income. Hobby expenses are no longer deductible on the Schedule A due to the Tax Cuts and Jobs Act, but may still be deductible for your state.

How to report hobby income on Schedule 1:

1. From the Input Return tab, go to Income ⮕ SS Benefits, Alimony, Misc. Income.
2. Under the Alimony and Other Income section, enter your hobby income in the Other income field.

How to report hobby expenses for the state:

1. From the Input Return tab, go to Deductions ⮕ Itemized Deductions (Sch. A).
2. Click the Miscellaneous & Other tab at the top.
3. Under State Miscellaneous Deductions (Subject to 2% AGI limitation), locate the Miscellaneous Deductions (2% AGI) subsection.
4. Enter any expense exceeding your total income received in the Other miscellaneous deductions field.

For more information about hobby income and expenses, see IRS Publication 529 Miscellaneous Deductions.