how to file taxes for a Home business with a loss?
September 29, 2009 by workathomebizreviews
Filed under Home Business FAQ
rachel b asked:
I have a small home business that I had a loss on this year. It is my first year having a business and was wondering if i could just file a 1040 ez since I had a loss.
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I have a small home business that I had a loss on this year. It is my first year having a business and was wondering if i could just file a 1040 ez since I had a loss.
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No- you won’t qualify to file a 1040EZ but it’s not in your best interests to do that anyway. You have to file Schedule C or C-EZ. You want to report as many deductions as you can to get the biggest loss you can. You also want to depreciate business assets if you have furniture or equipment, for example, that was used in your business. This will generate more deductions.
If you have other income your business loss will offset that other income, wages or interest income, for example, and reduce your taxes.
If you don’t have other income you may have a net operating loss that can be carried back to offset income in prior years and get a tax refund from a prior year.
home business
If you are running a home business, you should DEFINITELY get a CPA that specializes in business. You’d be ammmmmazed the things that will be deductable!
Good Luck.
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No, 1040EZ is only for wage earners with W-2 wages. All self-employed folks must file Form 1040 and Schedule C at the very least.
home business
If you have 0 (no) income, you can skip filing and add the expenses to next year or when you have income. Otherwise you have to file 1040 and schedule C