"INTENT" MAKES A DIFFERENCE.

If you are conducting your stock photography in a professional manner, you are no doubt showing intent to make a profit.

The IRS takes the following circumstances into account in determining your intention to make a profit:

- The manner in which you carry on the activity.

- The expertise of yourself and your advisers. Put another way, do you know what you are doing, or do you hire somebody who is knowledgeable about the operation that you undertake? .

- The time and effort you expend in carrying out this activity. Holding down a full-time job does not preclude your being engaged in a separate profit-intent activity.

- The expectation that assets used in your business may appreciate in value.

- Your success in carrying on other business endeavors.

- Your history of income or losses with respect to the activity.

- The amount of occasional profits, if any, that are earned.

- Your financial status.

- The elements of personal pleasure or recreation.

In my next column, I will cite some cases in which the IRS did agree or disagree that intent to make a profit was present.