Tax Guru – Ker$tetter Letter

Helping real people win the tax game.

Yet another clueless corp owner

Posted by taxguru on April 24, 2009

Q:

Hi – Very helpful information on the web. I have one quick question – if my company is a C Corp and has a loss can I deduct that on my 1040? Thanks!!

A:

No.

An S corp can possibly have its losses flow through to your 1040, but a C corp doesn’t work that way.

Setting up a corp without understanding how it works was very foolish and dangerous.  You need to get with a professional tax advisor ASAP to straighten things out before you do any more damage.

Good luck.

Kerry Kerstetter

Follow-Up:

Its kind of you to respond but there is no need for that demeaning attitude.

My reply:

I’m sorry if I offended you, but I assure you that it is for your own good.

I have long had a reputation for telling it like it is and not sugar-coating the truth.  Anyone writing to me for advice can expect that kind of response.

In your situation, it is obvious that you, as do may other business owners, jumped into setting up a corporation all by yourself without consulting with knowledgeable professionals.  The consequences of this reckless and irresponsible act can be very expensive as you most likely have already violated all kinds of tax and legal requirements.

For your own sake, you need to start working with a qualified tax pro ASAP before you get yourself into more trouble.

Good luck.

Kerry Kerstetter

 

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