There should also be no issues in that respect when the business closes.
A possible scenario where it could be an issue.
You purchase $40K of inventory in 2020 and only sell $5K of that inventory. Then for whatever reason you go bust in 2021 with $35K of inventory remaining that you expensed. On paper, this could result in a $35K "loss" for inventory that you kept for personal use. It's not a loss per-se, because you kept it for personal use. Yet on the tax return, you're claiming a loss. Seems a bit underhanded to me, since inventory removed from the business for personal use is not deductible.
