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Merlo
Merlo, Accountant
Category: Tax
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Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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I started a side business last month. I understand that certain

Resolved Question:

I started a side business last month. I understand that certain expenses are deductable against the business's income. Do these expenses also provide a deduction against the income from my regular day job?
Submitted: 6 years ago.
Category: Tax
Expert:  Merlo replied 6 years ago.

Hello JA Customer,

 

When you have business income which is separate from your regular job, your business income and related expenses are reported on Schedule C of your tax return. You then pay tax on your net earnings from the business after deducting your allowed expenses. If you actually end up with a net loss from the business activities, then that loss will offset income you have from other sources.

 

So the expenses from your business do not directly provide a deduction against your regular job wages, but if you end up with a net loss from your business activities, that loss can be used to offset income you have from other sources.

 

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Thank you JA Customer

 

 

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