Using a business DBA and Schedule E for rental income/expenses

[Virajsmom]

Thank you so much @Carl - I will follow your advise and get the Cd and start working on my taxes and get familiar with it. I appreciate all your guidance on the insurance and other details - will get these changes incorporated soon. 
Thank you again for being such a knowledgeable wonderful mentor!!

[Carl]

You can purchase the CD online directly from TurboTax at https://turbotax.intuit.com/personal-taxes/cd-download/ 

You just download the installer after you pay for it, double-click the downloaded file and install it. You'll need the Deluxe version or higher for rental property. Make sure you get the right flavor also. There's one for Windows and one for MACs. So if you get the wrong one, you own it. It's a pain dealing with TTX to swap it out for the right one.

You may also be able to get it cheaper from a 3rd party source. Just make sure its an authorized reseller of the product. Places like Wal-Mart, OfficeMax, Target are fine. I'd be wary of buying from 3rd party retailers on Amazon though.

Also make sure you get the one for the tax year you want. Since TurboTax 2022 is not out yet, you'll want TurboTax 2021. Since tax laws change every year, the program changes every year to keep up. So trying to use TurboTax 2020 to complete your 2021 tax return won't work out to well.

Also, just so you know, since the program does have to change every year to keep up with tax law, you have to purhase the program each tax year. The nice thing about the CD version is that you pay for the program "ONE TIME" and that's it. You can complete as many tax returns for the tax year purchased, as you need to. However, there is one catch and it's an IRS requirement; not a TurboTax requirement.

With the CD version you can only e-file a maximum of 5 returns. After that, you can still complete more tax returns for that same tax year. But you have to print, sign and mail them to the IRS.

Finally, with the CD version it comes with an activation code you must enter in order to use it. That code only works 5 times. So you can only install the program on 5 computers at the most. A reinstallation of the program on the same computer also counts as one of the 5. So when you get the CD, do not lose the activation code.

Not that the above limits may apply to or affect you. But I do want you to be completely aware.

[Virajsmom]

@Carl  Thank you so much! This is very helpful.

[pigsflynow]

@Carl My husband just recently got a DBA with a separate EIN. Applied for the DBA in November 2022, got EIN December 21, 2022. We've only had expenses for starting the DBA, business cards, flyers, etc. Do we need to file the business with our personal tax return or do we file separately them? First year having to add something like this and want to make sure I'm doing it right? We do not have any sales. 

[Vanessa A]

Yes, since he is just DBA, you will include his business income and expenses with your personal return by attaching Schedule C.  To do this you will need to use TurboTax Home and Business or TurboTax Self-Employed.

[Carl]

My husband just recently got a DBA with a separate EIN. Applied for the DBA in November 2022, got EIN December 21, 2022.

Understood.

We've only had expenses for starting the DBA, business cards, flyers, etc. Do we need to file the business with our personal tax return or do we file separately them?

 First, I'm making a few assumptions. The business has one owner, and only one owner. Doesn't matter which spouse it is and it doesn't matter that you're filing a joint return. With only one owner, the business income/expenses is reported on SCH C as a part of your personal 1040 tax return. Again, it does not matter if that 1040 return is a joint return. (I would expect it to be)

 First year having to add something like this and want to make sure I'm doing it right? We do not have any sales.

For starters, were you official "open for business" on or before Dec 31 of the tax year? If you were not, then you have absolutely nothing what-so-ever to report about the business on your 2022 tax return.

It's perfectly possible and very feasible that you have "start-up expenses" that you paid in 2022. If you were not "open for business" in 2022, then those start-up expenses are not deductible on your 2022 tax return. Instead, they would be deductible in the first year you "are" open for business. So if that's 2023, start-up expenses would be claimed on your 2023 tax return that gets completed next year.

Start-up expenses are deductible in the first year the business is "open for business", and it does not matter in what year those start-up expenses were incurred either. It's not at all uncommon for some businesses to incur such expenses for several years before they are officially "open for business".

Now, if you were "in fact" open for business in 2022, then the fact the business produced no income is irrelevant. You still report the income/expenses. However, since you have no business income from which to deduct your businses expenses, they just get "carried over" to the next year where you can deduct them; provided of course the business has the income to actually deduct them from.