Reportable Income For Taxes

 
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Posted On : 25th Nov 2010

I started a business this year but did not make any money. Do I need to report this on my tax return?

Answer: You should report any gain or loss you made on the business even if you did not make any money. In many situations a business loss can offset other income.

Example: A taxpayer starts a business in October 2004. The taxpayer spends $10,000 on different business expenses, but money only starts to come in during 2005. The taxpayer reports the $10,000 loss on his 2004 tax return and it lowers the taxes he would have otherwise had to pay on the money he made during the first part of the year.

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