Three-of-five test

{
  "id": "MLC-T-LAW-004915",
  "term": "Three-of-five test",
  "field": "Law",
  "definition": "A standard used by the U.S. Internal Revenue Service to determine if an activity is a business operated for profit or a hobby. Under this rule, an activity is presumed to be for-profit if it has generated a profit in at least three of the last five consecutive tax years, including the current year. For activities involving the breeding, training, showing, or racing of horses, the standard is two of the last seven years.",
  "url": "https://mlchart.com/terminology/law/three-of-five-test/"
}