All Things Tax

All Things Tax

Like the title says, from the filing process and tax questions to tax policy and reform, you can search and share All Things Tax here. This is the place to find answers to all your general questions that don't fall under the other categories. And just a reminder: questions about software or online filing should be posted in DIY Products.

Posts: 1
Registered: ‎04-18-2017

Had a side business that never made money with loss.

I started a business in 2016, as a side business I should add, and I never made any money on it.  I stopped the business in November but not after spending over $12,000 in advertising, office supplies and other items. Also, I never filed for and EIN number since I never made any money.  Can I add the loss of $12,000 to my income tax?

Trusted Council Member
Posts: 6,191
Registered: ‎02-23-2016

Re: Had a side business that never made money with loss.

Hi tcutler25,


Welcome to the H&R Block community.


Yes, you can deduct your expenses.  You actually need to file a Schedule C for your business an you can do that whether or not you earned any money.  You can deduct up to $5,000 in start-up costs such as training and other one-time costs of getting the business off the ground and then any start-up expenses in excess of the first $5,000 must be amortized.  You can deduct all of your routine expenses such as advertising.  If you end up with a business loss then it's deductible against your other income on page 1 of the 1040, and if you have loss remaining after your income is reduced to zero then the remainder carries over to next year.  Note that some items, such as equipment, furniture, and vehicles, are subject to special rules when it comes to expensing them.



Senior Tax Advisor (Tampa, FL)