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March 25, 2024
Question

Cash business but I got lawsuit money so I invested it into the business which means I spent a lot more than I actually made from my business refund can I get

  • March 25, 2024
  • 1 reply
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Trying to get a refund because I spent more money investing in my business cash business Then I actually made from the business

1 reply

March 25, 2024

we don't know if the lawsuit settlement is taxable because you provided no info about it. If you invested it in your business then you either spent it on items eligible for expensing which would be included in the business return/Schedule C or you bought capital assets(not eligible for a direct write-off)  in which case you would recoup that through depreciation. To give you better guidance we would need more info to know what the money was spent on and if for capital assets (furniture/fixtures/equipment did any item cost over $2500? 

We would also need info about the lawsuit to provide guidance on whether it's taxable or not.