Businessowner Now Employee

[Rookie7]

Used to be a small business owner, but business had been slow so decided to officially shut down business. Hired by a company in Jan 2024, closed business in March 2024. For the past 20 years, filed married jointly, using the Turbotax home+business software. To file 2024 taxes,  can we just use the home version only, and forget about the business? Btw, we had a loss in 2023 carried over. Also, with 2 W2s, we may owe the IRS. Several questions:

1. What software to use?

2. If filing married separately using home+business, how do we split the expenses such as home interest, etc.? Does the software know what to do? Thank you!

[Vanessa A]

Since you closed the business in 2024, you can use Home and Business to report the final income and expenses.

If you are married filing separately, then you would enter only the amount that you paid (or half if you split it or pay out of a joint account) for expenses that you are itemizing.   The software cannot give you the information since it does not know if you paid half or a different amount. 

Yes, it is possible that you will owe the IRS, it all depends on how much you had withheld or paid in versus your tax liability after credits. 

[Rookie7]

Thanks Vanessa. Forgot to mention that business revenue was zero in 2024, since i started working fulltime 1/1/2024. I have a  QBI loss carryforward, will it help lower our tax liability? Thanks!

[KeshaH]

You can only use your QBI carryover loss to offset QBI. Your loss will continue to carryforward indefinitely until you generate qualified business income to offset.

[Rookie7]

Thank you KeshaH. Since we closed the business in 2024, QBI income is zero but I have W2 income now. There was an input box for QBI loss carryforward, so i entered the loss of 19k, this reduced our taxes significantly. Am I reporting that correctly?

[BrittanyS]

No, the QBI loss carryforward should only be used to reduce business income.  If you do not have business income you would not be able to use the QBI carryforward loss.

@Rookie7 

[Rookie7]

Thanks Brittany. This helps!