Can I deduct business expenses, having had $0 income in 2016, or skip Schedule C and state that I did not work in 2016?

[thracker]

I am a Management Consultant who has always worked as a subcontractor.  I have never formed a company. I guess that makes me a Sole Proprietor.  In 2016 I had 0 clients and $0 income. Is it ok to deduct business expenses, having had $0 income, or should I just state that I did not work in 2016?

[PatriciaV · Accepted solution]

If your business is ongoing, you may report expenses in a year when you had no income. The loss will offset other taxable income. As long as you don't establish a pattern of losses year after year, you should be fine.