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Old 01-05-2009, 04:49 PM
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File or no file?

I have a single partner LLC. Last year I came out with a substantial loss. I was told be a preparer not to file the taxes since I didn't actually make any money. I am wondering if this was a mistake or not? Also I live in California but the business out of Oregon. If it was a mistake not to file should I send in the loss to the IRS and Oregon now? Any advice will be much appreciated.

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Old 01-05-2009, 06:30 PM
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You should have filed a tax return even as a Single Partner LLC that has substantial losses. These losses can potentially result in a net operating loss (NOL) on your Personal Tax return, that can be carried over to future years. The NOL carried over will offset regular income thereby reducing your future taxable income. This will effectively save you on your future tax liability.

I recommend that you file your Tax return and claim these losses, which will certainly enable you to benefit on the Federal Tax return. Most States generally disallow NOL carryforwards, so I suspect you would not benefit from Oregon State. Your CA individual tax return may not result in any change in the tax liability, but nevertheless, you are still complying with the Tax Law.

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