Question

No longer have business

Forum|Forum|2 years ago
April 17, 2023
1 reply
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For the last several years I have had w-2 income and I also owned a business, I no longer have my business, and did no business at all in 2022, I did not sell any of the business vehicles or equipment, how do I handle closing the business on my taxes.

AliciaP1

If you were depreciating or took the Section 179 or bonus depreciation on any of the assets of the business, you need to mark the assets as switched to personal use during 2022. If you intend to start the business back up, you do not need to report your Schedule C at all nor do you need to "close" the business.

If you are closing the business permanently and have these assets, you need to review the sections for Assets and Vehicle Expenses and go through each item there and mark them as "stopped using in 2022". Then proceed through the rest of the interview questions to enter the prompted information to correctly report any potential depreciation recapture.

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