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This Web site contains a compilation of more than a thousand consumer finance  columns written by Tony Novak from the 1980s through 2006, updated and reformatted for maximum usefulness today.  New material was added after 2010.

Content is the opinion of the author and does not represent the position of any other person or entity. Information is from sources believed to be reliable but cannot be guaranteed.

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Allowable business losses

originally posted: 11/22/2006  reposted: 3/18/2011

Q: My home-based business had a big loss last year and I expect another loss this year. How can I be sure the IRS will allow me to deduct these losses against other income?

A: Assuming your business is not incorporated, the only way to be sure is if you had income for the three years prior to last year, then the losses are definitely allowed. Otherwise there is always some room for interpretation according to published IRS guidelines.

Losses of a home-bases business are subject to challenge by the IRS

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