Can I claim tax deductions even if my home-based business didn’t make a penny?
moneyreligion asked:
Does a business, home-based or not, need to have any sort of income to get the tax deduction advantages?
Does a business, home-based or not, need to have any sort of income to get the tax deduction advantages?
Help me be less accounting challenged.
Arcade Platform
Tags: Accounting, Tax Deductions, Tax Help
I was always under the impression that the less a business made the more you can claim at tax time. My friend is an accountant and she always tells me to hide a bit for this reason.
If you truly had a business and ran it in a business-like manner, then you do the schedule C and claim the deductions.
Keep in mind, you had to actually be open for business, not just getting set up. Zero income is not a good sign.
If you are starting the business, you had better have the expectation of making a profit within 3 years–the IRS expects you to and you can be audited and deemed a hobby (disallowing the losses).