Yes you can. The only difference is the business license and having to follow those rules and guidelines. Having a licensed business allows for more tax incentives and things like that. Where as being hobby status doesn't come with the same headaches as getting licensed, doing a fictitious name, etc.

One example is when you do your taxes as a hobbyist you can still declare deductions from things you've purchased for the hobby, but they will only take you to a 0. If you spent more than you earned you won't be able to use it towards a return. As a business, you will be able to go beyond the 0 into the return status.

However, if you are profitable 3 out of 5 years you are supposed to switch to business status. Same as if you aren't profitable 3 of 5 years you are supposed to switch back to hobbyist.

I got my business license and I'm going that route first. It costs a little money to get your license and everything, but it's not hard to do...