Originally Posted by t8ronellis
I did not report all of my business expenses on my schedule C; my bank account shows $21k more than I reported. If I report it all, my profit become a lost and an audit risk, I'm not a start-up. Will the IRS demand that I report it all?
How do you know that if you report it all, your profit become a lost and an audit risk by the IRS?? Assume that you MUST/need to report it all even if your profit on your Sch C of 1040 becomes a lost, NOL;asyou can see, you can claim your NOL on your return; You carry the NOL back to two years prior to the NOL year. If your NOL is more than the taxable income of the year you carry it to , you generally will have an NOL carryover to the next year. Or You have the option of applying your NOL only to future tax years. This is called carrying a loss forward. You can carry the NOL forward for up to 20 years and use it to reduce your taxable income in the future