Schedule C loss

[dcg]

What is the name of your state? new york

Started a sole prop in 03. That is I bought tools and a truck in 03. I have -0- income. Should I do the schedule C and show a loss or should I wait and put all the tools and vehicle in service in 04?

I'm concerned filing the first C with no income will produce an audit.

Also, if I put the tools and vehicle in service in 04, can I use the original cost or do I have to show some depreciation?

If more detail needed let me know.

Thanks

Thanks Snipes for the input on another question I had.

 

[Snipes5]

Showing a loss in the first year of a sole pro won't necessarily trigger an audit.

Showing losses for three years running, and NO income might be a bit suspicious.

Place the stuff in service, use MILEAGE for the truck, count only business mileage.

Whether or not you depreciate the tools depends on what they are.

Hammers, wrenches, etc, are an expense.

A larger tool you'd depreciate or use Sec 179, which allows you to take the entire cost the first year.

You might want to see a tax pro who can determine the best direction to take.

Snipes