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Tax question- what if my itemized deduction is higher than my adjusted gross income?
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3 Responses to Tax question- what if my itemized deduction is higher than my adjusted gross income?
You don’t put negative numbers in. Just put a zero. And the IRS expects you to make a profit only two years out of five. So if this is your first year in business, they won’t even blink… unless you claim expenses of seven zillion against income of six dollars.
20 years of programming
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As long as you have the paper work to back you up, you’ll be fine. A lot of business end up being in the red when it comes to tax time. Just be sure to keep your paperwork in order.
20 years of programming
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You need to file a Schedule C – a form for Business expenses. These should not be itemized deductions. When you look at the form you will see the logic. This will give you a loss for your business rather than excess deductions. The loss will be carried to your 1040.
I’m a CPA , and I do this for a living.
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