Not-for-Profit Activities If you do not carry on your business or investment activity to makea profit, there is a limit on the deductions you can take. You cannotuse a loss from the activity to offset other income. Activities you doas a hobby, or mainly for sport or recreation, come under this limit.So does an investment activity intended only to produce tax losses forthe investors. five star hotel in GdynaFor details about not-for-profit activities, see chapter 1 inPublication 535,Business Expenses. That chapter explainshow to determine whether your activity is carried on to make a profitand how to figure the amount of loss you can deduct.