Final answer:
Unreimbursed employee business expenses and hobby expenses are generally nondeductible, which is true. Since the Tax Cuts and Jobs Act of 2017, these employee expense deductions have been suspended, and hobby expenses cannot be deducted beyond the hobby income.
Step-by-step explanation:
Unreimbursed employee business expenses and hobby expenses are generally nondeductible. This is indeed true. Prior to the Tax Cuts and Jobs Act of 2017, employees could potentially deduct unreimbursed business expenses that exceeded 2% of their adjusted gross income. However, the Act suspended these deductions for tax years 2018 through 2025. Therefore, unreimbursed employee expenses incurred within these years cannot be claimed as itemized deductions.
Hobby expenses also face similar restrictions. The IRS distinguishes between hobbies and businesses, and it does not allow taxpayers to deduct expenses associated with hobbies beyond the income produced by the hobby itself. The primary intent of engaging in the activity must be for profit for it to be considered a business and thus have its associated expenses potentially deductible.