Which of the following is/are trade or business expenses? Mahlon incurs expenses related to investing in stocks and bonds. Mahlon is a Sociology I. professor at State University but spends 10-15 hours per week on his investments. Almost 2/3 of Mahlon's annual income comes from his investments as dividends and interest. II. Shaheen has expenses related to managing her portfolio of securities. The short-term trading of her securities generates most of her annual income. She has no other job.
A) Only statement I is correct.
B) Only statement II is correct.
C) Both statements are correct.
D) Neither statement is correct.

Question

Quizplus · Accepted Answer

Shaheen's activities are more likely to be considered a trade or business because her short-term trading of securities generates most of her income, and she has no other job, indicating a level of regularity and profit motive typical of a business. Mahlon's investment activities, despite being significant, are more likely to be considered personal investment activities rather than a trade or business.

Which of the Following Is/are Trade or Business Expenses? Mahlon