Donny is a grade school teacher whose annual income from teaching is $$45,000.$ He

has always enjoyed bowling, and his local pro urged him to turn professional. He

subsequently begins working for the pro as an unpaid assistant and enters an

apprenticeship program with the Professional Bowler's Association of America $($PBA$).$

As an apprentice, he accumulates credits toward becoming a member of the PBA by

taking approved classes, working as an assistant pro, and competing in pro

tournaments. Donny expects to be approved as a full member of the PBA next year.

Although Donny continues to teach full$-$time, he goes to the bowling alley each day after

school and practices after fulfilling his duties as an unpaid assistant. During the

summer, he spends $12$ to $15$ hours each day at the bowling alley. In addition, he

participates in as many PBA tournaments as he can work into his schedule.

Donny has come to you for advice on the deductibility of the expenses he has incurred

in his bowling career. Since deciding to turn pro, he has won money in tournaments

every year. However, his expenses exceed his earnings by $$5,000$ to $$10,000.$

The pro has told Donny that he should be able to offset his teaching salary with his

excess expenses from bowling if he can prove that he is engaged in a business. Donny

is worried that his bowling might be considered a hobby instead of a business. Consider

the code sections that apply to business expenses and to expenses of activities not

engaged in for business and evaluate Donny$$s situation in a formal research memo

format.