Was this business reported on Schedule C of your personal tax return (it was a Single Member LLC that did NOT elect to be taxed as a corporation)?
If so, if the business had a loss, that loss offsets other income on your tax return. If there was no other income (or not enough for the loss to offset), that creates a Net Operating Loss (NOL).
In answer to your question, the business had a "loss" (negative income for the business), but YOU had the NOL (negative income on the entire tax return). That means it follows you, regardless if the business exists or not.
