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tkrukoff
New Member

Can I; a silent partner in a Handyman business deduct $25K for various tools that I paid for and $7k towards a vehicle? Can I deduct any of the $32K in my 2018 taxes?

 
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3 Replies
CaronM
Intuit Alumni

Can I; a silent partner in a Handyman business deduct $25K for various tools that I paid for and $7k towards a vehicle? Can I deduct any of the $32K in my 2018 taxes?

How is the business organized? Is it an LLC or corporation that you own part of? Or was this a loan?
tkrukoff
New Member

Can I; a silent partner in a Handyman business deduct $25K for various tools that I paid for and $7k towards a vehicle? Can I deduct any of the $32K in my 2018 taxes?

It's a sole proprietorship.  Its a small business where the owner has 51% ownership and I have 49% with no involvement except providing tools.  We set it up where he has 3 years to pay me back at which time he will have 100% ownership.  The majority of the tools were purchased in 2018 and this hear it has been very minimal.  Thank you for responding and I look forward to your next response.
CaronM
Intuit Alumni

Can I; a silent partner in a Handyman business deduct $25K for various tools that I paid for and $7k towards a vehicle? Can I deduct any of the $32K in my 2018 taxes?

If a business has two owners, like you are indicating, then it defaults to being a partnership. You can elect to be taxed as a corporation, but under no circumstances can it be a sole proprietorship - by definition a sole proprietorship only has one owner. You will need to file a partnership tax return (Form 1065) for the business, and then you will receive a Form K-1 to include on your personal tax return.

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