Two teenagers bored during a covid lockdown, decided rather then focus on the negative effects of a lockdown, to jump on a 'once in a century business opportunity'. They began to sell brainteaser puzzles in Australia , thinking to try and make a few bucks, but what happened far exceeded what they were expecting. Within a month they made a sweet $70k. Not bad for an 18 and 19-year-old at all. Although the partners were not expecting this business to take off like it did, they still intended to make money which their venture. Therefore, the $70k and future potential earnings that they will make, will be classified as ordinary income of business, which is taxable. If the main intention initially was not to make a profit, would that mean that if in the future, if some money was to be made, would it be income of business?

Answer rating: 100% (QA)

It doesnt matter whether there was or no intention to make a profit out of a busi... View the full answer