Are losses from NJ LLC's deductible on the NJ Individual Tax return?
Are the LLC's losses generated from an NJ LLC deductible on the individual shareholders tax return, assuming there is sufficient basis to claim these losses?
New Jersey State does not conform with the Federal tax return when it comes to reporting the K-1 losses from LLC's or S Corporations. As such, according to New Jersey State Tax, "if the net amount from all Schedule NJK-1's is zero or less" no deduction for any losses are allowed on the Form NJ 1040."
Thus, these losses are not deductible on the NJ 1040 tax return, but taxpayers can offset the losses of K-1's from one or more LLC's with gains from other K-1's.
What about Maryland? for a single member LLC, can you deduct your losses in your income tax return? if not, then a sole propietor makes more sense for a small business.
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