Jump to content

Sign in to follow this  
justcheckingitout

Tax help

Recommended Posts

My husband is a teacher and I have started a small business this year. I have not made very much money at all and when I fill out the business expenses portion of our tax form, it makes us have a huge refund. This is very scary, we have never received a refund before (this is my first year not working due to having a child).

 

It looks like the miles I have put on my vehicle are the culprit. (Alot of driving with the business).

 

I have not made much this year but I am hoping that all of the driving I did will benefit next year and my business will grow.

 

I guess I am saying I feel shady looking at my tax return and seeing that my business is a $25,000 loss. When in reality it just does not feel like I was so negative.......... Although I did not even break even.

 

Will it be flagged by the IRS? Should I limit my losses this year? So I the numbers on my forms do not look so strange?

 

Please any help would be appreciated.

 

Thanks!

Share this post


Link to post
Share on other sites

As long as you have receipts for the things you bought and kept track of mileage on a log yoiu will be fine, its very common for a business to have a lose in the first year or two, $25,000 may seem like alot but compared to most businesses that isn't that much in the eyes of the IRS

Share this post


Link to post
Share on other sites

In most cases, businesses will generate substantial tax losses the first few years. My first two years, my taxable loss was $50k+ each year, it looks like my 09-10 year will show a small taxable profit. As long as you have solid documentation on your deductions, take them.

 

Also, keep in mind that taxable profit/loss, is only for taxation. Many businesses are making money hand over fist, and generating a net loss on their tax returns. The opposite is also true, businesses losing money can generate a taxable net profit. Your taxable profit/loss is not the same as your operating profit/loss.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this  




  • Today's Birthdays

  • Member Statistics

    • Total Members
      177,994
    • Most Online
      2,046

    Newest Member
    John1892
    Joined

About Us

Since 2003, creditboards.com has helped thousands of people repair their credit, force abusive collection agents to follow the law, ensure proper reporting by credit reporting agencies, and provided financial education to help avoid the pitfalls that can lead to negative tradelines.
×
×
  • Create New...

Important Information

Guidelines