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New Member
posted Jun 1, 2019 2:46:01 PM

If Federal Refund decreases with increased business expense, are we better off not claiming those expenses?

When adding rental expenses such as maintenance fee, property tax etc. the federal refund keeps on decreasing. Why should we even claim for these expenses if it only results in higher federal tax rate?

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1 Replies
Level 15
Jun 1, 2019 2:46:02 PM

This is due to the way the EIC is calculated.

But you are required by law to claim all of your expenses.

https://www.eitc.irs.gov/tax-preparer-toolkit/frequently-asked-questions/earned-income-self-employme...