I own a home based business of which I profited less than $5000 this past year. I had some loss from deductions. 2005 I profited $13,000 (so I claimed my income and itemized my deductions)...my question is I was told that if I make less than $5000, I can't itemize my deductions...is this true, do I not claim anything from my business this year?
2007-04-02 02:43:31 · 1 answers · asked by lizzieRN13 2 in Business & Finance ➔ Taxes ➔ United States
Itemizing deductions is a totally separate issue from claiming business expenses. Even if your profit is under $5000, you still have to file a return and show the amounts.
For your home business, you'll fill out a schedule C or C-EZ. You'd list any deductible business expenses there, even if they are only $1. This will reduce your income from your business.
Itemizing deductions is done on schedule A. These are personal expenses, and since if you're single you get a standard deduction of $5150 without listing anything or filling out the schedule, you'd just take the standard deduction if your itemized deductions are less than the standard.
2007-04-02 02:51:59 · answer #1 · answered by Judy 7 · 2⤊ 0⤋