Showing a loss for 3 years in a row could put you at risk for a hobby loss audit. If you are actively trying to sell real estate and are operating like a business, but just haven't made any sales, you may prevail in an audit if you have all your documentation in order. It is understandable that you do not want to risk getting audited though.
You can leave the business in TurboTax with $0 income and $0 expenses, but if you are depreciating a vehicle or other assets, these will show up on Schedule C under depreciation expense. It would be best to "dispose" of those assets, in TurboTax. You will choose "converted the assets to personal use".
Answer
"yes" to the Special Handling question
(you converted the asset to 100% personal use). When you convert an asset to
personal use, there is no gain to report. However, you must report any section
179 recapture this year. A section 179 deduction is subject to recapture if you
converted the asset to personal use before the end of its depreciable life.
If you choose to, you can delete your entire Schedule C this way:
- Go into Forms mode by clicking "Forms" in the top right corner
- Scroll through the forms in your return
- Select "schedule c"
- Select "delete form" box at the bottom of the screen
You can include your expenses on your wife's Schedule C only if she "pays the expenses". She just needs to keep business receipts to show that her business paid the expenses.
