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Business losses Companies do not always earn a profit. This is particularly likely to occur when starting out or when economic conditions are bad. If you are in this unfortunate situation, you may get some tax relief. This could offer a refund of all or part of the taxes from previous years, in just 90 days of the rapid infusion of cash to be very useful.

If, like most small business owners, which is a sole proprietorship, you can deduct any loss of business incurred from your other income for such year, the result of a job, investment income, or income your spouse (if filing jointly). If your business is operated as an corporation or association, its share of business losses are passed through the company to its individual statement and deducted from their other personal income in the same way as a sole proprietor. However, if you operate your business through a Corporation cannot deduct a loss of business in your personal statement. It belongs to the corporation.

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