Friday, November 6, 2009

I just incorporated in Nov 2007 but earned no money. Do I need to file a business tax form or just personal?

I incorporated as an S Corporation. I just filled out a business tax form on turbo tax online but all I have are deductions from getting the business started. I don't want to make a mistake and I'm confused. Do I even need to file anything as I didn't earn any money? I worked and earned money as an employee at a local company so I am filing a personal return.

I just incorporated in Nov 2007 but earned no money. Do I need to file a business tax form or just personal?
Some costs of starting a business are IRC sec. 197 expenses and must be amortized over 60 months as start up costs (vs. currently deductible) but you need to make the election on your return. You need to file a 1120-S whether you make money or not and the net flows to your 1040. I would recommend that you need to file your 1040 whether you owe any money or not because you start the 3 year audit clock running. If you don't file, the clock doesn't start.


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