What is a book loss for a business

mjmom11 — Thu, 06 Jun 2019 05:20:41 GMT

I started my State return and I know nothing about taxes so I don't know what Book Loss means. Talk to me like I am a two year old so I understand.

Any business should keep books and records of its busines...

Howard1948 — Thu, 06 Jun 2019 05:20:42 GMT

Any business should keep books and records of its business transactions. These records are usually kept on either a cash basis reporting or an accrual basis reporting. The results of all the income and expense transactions within the business is the "book income or loss."

For Federal income tax reporting, tax laws may require certain adjustments to that book income or loss because tax law differs from standard accounting practices. For example, if the business had a life insurance policy on an employee and that employee died, the business has income in the amount of the life insurance proceeds received. But for Federal income tax purposes, life insurance proceeds are not income and therefore are not included in tax income. Accountants tend to call differences between book accounting and tax accounting a "Schedule M" item as that schedule is used to reconcile "income per books" with "income per tax return".

topic What is a book loss for a business in Business & farm

What is a book loss for a business

Any business should keep books and records of its busines...