Business Losses

Business Losses

Category : Blog , sccm





Business owners can generally deduct business losses on their tax returns. But the activity must show a profit motive by operating in a businesslike manner, which includes proving expenses. An owner of a music production and promotion company wasn’t allowed to deduct the net operating losses (NOLs) he incurred, because the IRS determined he was engaged in a hobby. The U.S. Tax Court found a profit motive did exist, but denied the deductions because the NOLs weren’t substantiated. (TC Memo 2018-67)


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