I:6-32 Katie and Alan are avid boaters and water skiers. They also enjoy parasailing. This year, they started a new parasailing venture to provide rides to patrons. Katie and Alan are both employed full-time in other pursuits, but they take patrons out during the summer months, on weekends and holidays. Alan has attended classes on boat operation and parasailing instruction. Katie and Alan have owned a boat for four years, but because of the heavy usage this summer, they replaced their old boat in July. They plan to replace their boat with a new one every two years now. They use their boat in the parasailing activity and for recreational purposes. This year, Katie and Alan earned $5,400 from chartering activities and incurred $11,600 of expenses associated with their boating and parasailing. What tax issues should Katie and Alan consider?