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houseboat68
New Member

Is it required to report expenses on business taxes?

 
2 Replies
Opus 17
Level 15

Is it required to report expenses on business taxes?

Actually yes.

This usually comes up in the context of someone who wants to show higher net income to qualify for earned income credit or qualify to make IRA deposits.  But yes, you are required to report your income and your legitimate expenses and only pay tax on the net profit.  Overstating your income to qualify for a tax benefit is just as improper as trying to hide income.

And if you are trying to show a larger income for a non-IRS purpose such as qualifying for a mortgage, it may be considered to be a fraudulent loan application if you get caught.

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
Kaynichole615
New Member

Is it required to report expenses on business taxes?

I cleaned houses this year after losing my job. I know what I made because I had the same customers every week or every other week. But I didn’t keep track of my expenses, nor did I save receipts. Should I still try and claim the expenses with no proof? 

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