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    6 Replies Latest reply on Apr 28, 2008 1:57 PM by nytaxguy

    need help?

    grpetsupplies Wayfarer
      Okay I started a business as a sole proprietor and I had quite a bit of expenses all charged to two credit cards, I made exactly 20 dollars at a loss due to the company I hired to do my web site having the incorrect sales amount on the site...it ended up costing me 10 dollars of my own money to sell the one item I sold. I now have a new company redesigning my site. Anyway, to make a long story short, what do I need to prove the losses my company had....would just copies of my credit card bills with the expenses highlighted do it? I guess I really need to find a CPA/accountant...but it seems so daunting to find one...any and help is greatly appreciated! thanks.
        • Re: need help?
          Lighthouse24 Ranger
          As a sole proprietor, you'll complete Schedule C for income taxes, and it will more or less guide you through the process you need to follow -- enter your Gross Sales, calculate and subtract your Cost of Good Sold, deduct your Expenses, and you'll get your Net Profit or Loss (which is transferred to the appropriate line on your 1040 Form. As long as your documentation (sales invoices, purchase receipts, credit cards bills, etc.) show that you sold an item for $20 that it cost you $30 to buy/make, you'll be fine. Well, maybe . . . if you only had that one sale all year long, yet incurred much greater expenses that resulted in substantial losses, there's a possibility the IRS could say that you weren't really engaged in a business at all, and they'd disallow the loss. If you think that might be the case, you'll probably want to seek a tax professional's advice before filing. Hope this helps. Best wishes.
          • Re: need help?
            grpetsupplies Wayfarer
            thanks...I am on a search for an accountant/cpa now....thanks so much!
            • Re: need help?
              nytaxguy Wayfarer
              I am a CPA with quite a few out of state clients and would be willing to help you out if still needed. My fees are very reasonable and could probably b e done via fax, e-mail etc. Anything that can be documented has potential to be deductible. Documentation comes in many different forms but it sounds like what you have could work.