Thank you. I did not know that the IRS requires a business to deduct all of its expenses. Seems counter intuitive, as some may operate their business in such a way as to keep expenses to a minimum, while others might believe (rightly or wrongly) that if they incur greater expenses that may lead to a more profitable business. Sounds like it may penalize businesses that operate on a shoestring.
Just to clarify, the business in question is a start up individually owned LLC, which will file a schedule C to a 1040 for a married couple filing jointly. Does this change anything? Thanks again for your help.
