Carl
Level 15

After you file

The fact your "business" did not have any income in 2016 is irrelevant. As far as the IRS is concerned, you were "open for business" unless you reported on your 2015 return that the business closed, was sold, or otherwise disposed of. You will still file a SCH C for 2016, regardless of the business income/expenses.

Do note that if you have no income, you still claim your expenses. However, your expenses will not be "allowed" since you have no business income from which to deduct them. Instead, they will be "carried over" to next year. But if you don't claim them this year, then you can not carry them over to next year. Additionally, if you did not report a disposition of the business on your 2015 taxes, if you don't file a SCH C on your 2016 taxes then it will most assuredly generate an audit 24-36 months down the road.

Do note also that since your business had no income in 2016, there are some expenses that are not allowed at all, and can not be carried over. Health insurance is one of those items, and you will have to claim that as a personal expense on your SCH A subject to deduction limits and requirements.

One thing you can do since your business had no income in 2016, if you truly did NOT conduct business or even try to get business, is to remove all business assets for personal use so as to stop depreciation. Note that will limit your expenses, since you can't claim expenses against an asset that was removed from the business. Then on your 2017 tax return if you have business income, you can always place those assets back "in service".