business loss tax deduction/credit

[samit700]

What is the name of your state (only U.S. law)? New York



Hello,
This is the first time I am filing tax return when I had a small business last year. Any help appreciated.

Last year from Jan to March, I worked full time and made about $13,000 during the period and paid taxes close to $2300. I then started my small venture in April and invested in some labor and computer inventory. However, the venture was not successful and I closed it down in Dec, taking losses close to $25,000.

Can I show my business losses on my return to claim tax credit for last year? If the tax credit for the business losses exceeds $2300 (taxes I paid on my income last year), how do I claim the remainder?

I am using turbotax to file my taxes and really confused on how to incorporate these details. I want to file my taxes as accurately as possible.

Regards,

Sam

 

[LdiJ]

What is the name of your state (only U.S. law)? New York



Hello,
This is the first time I am filing tax return when I had a small business last year. Any help appreciated.

Last year from Jan to March, I worked full time and made about $13,000 during the period and paid taxes close to $2300. I then started my small venture in April and invested in some labor and computer inventory. However, the venture was not successful and I closed it down in Dec, taking losses close to $25,000.

Can I show my business losses on my return to claim tax credit for last year? If the tax credit for the business losses exceeds $2300 (taxes I paid on my income last year), how do I claim the remainder?

I am using turbotax to file my taxes and really confused on how to incorporate these details. I want to file my taxes as accurately as possible.

Regards,

Sam

Its a little more complicated than you might realize. If you want to guarantee that you get accurate results you really should consider using a tax professional.

In any case, much depends on whether or not you set up a separate business entity. Without knowing whether or not you did, its difficult to advise you. However, if you set up an LLC with only one member, that would be a disregarded entity for tax purposes...and therefore you would still file a Schedule C.