OK Mhe taxpayer must make a profit in the business within the first three years. ark for follow up Question 31 of 75. All of the following statements are true regarding a trade or business EXCEPT: The taxpayer should have evidence that they are engaged in a trade or business. 3 af five A trade or business is an activity carried on primarily to make a profit. Taxpayers are considered self-employed if they carry on a trade or business as an independent contractor or a sole proprietor Mark for follow up