Business tax

[pjms]

Hello!

I recently filed my personal tax return with the IRS.  Last year I started a small business at home.  I did not make any money and the expenses I could ignore for now.  I'm not sure if I still have to file a tax return for my business or if I should have included it with my personal return.  Will I be penalized for not filing and the business was registered in 2021?

[DawnC]

You won't be penalized for not filing a return if you had no income - - unless, you also claimed the Earned Income Credit.   That credit is dependent on income and you had business expenses that you did not report, your income was overstated and may have qualified you for too high of a credit.   If you do not qualify for the EIC, this doesn't apply to you.    But check line 27 to be sure.  

Starting a Business

Whether you filing your business return with your personal return (Schedule C) or by itself, depends on your business structure.   Sole proprietors file Schedule C with their personal return.  S-corps, C-corps, and partnerships must file a separate return for their businesses.   Those structures file their tax return and provide you with a K-1 to report on your personal return.