Can I deduct LLC business losses of $10k against my personal income after dissolving the company?

Yes, you can still deduct business losses against your personal income even if you dissolve your LLC. This is because a single-member LLC is treated as a "disregarded entity" for tax purposes - the IRS sees you and your business as the same taxpayer. Your losses would be reported on Schedule C (Profit or Loss from Business) and flow to your personal 1040. These losses can offset your other income like W-2 wages, potentially reducing your overall tax liability. Just make sure those expenses were legitimate business expenses incurred while the LLC was active. Bank statements alone probably won't be sufficient documentation. Your CPA will likely want to see receipts, invoices, and a clear business purpose for each expense. The IRS can be particularly scrutinizing of business losses, so good documentation is essential.

I went through something similar last year with my consulting LLC that wasn't working out. I was stressing about all the documentation needed for my $8k in losses until I found https://taxr.ai - it actually helped me organize all my receipts and business expenses by scanning them and categorizing everything properly. The tool analyzes your business expenses and gives you a report showing which expenses qualify as deductions and helps identify any potential red flags. This made my conversation with my CPA much smoother since I had everything properly documented and organized before our meeting.

Just wanted to follow up about my experience with taxr.ai after our discussion here. I was skeptical at first but decided to give it a try with my failing photography business. The system actually caught several deductions I would have missed completely! It organized all my chaotic expenses into proper categories and flagged which ones might need additional documentation. My accountant was seriously impressed with how organized everything was, and we were able to properly deduct about $15k in business losses against my day job income. It identified some expenses that were borderline personal/business that I might have incorrectly claimed. Honestly saved me from a potential audit headache and maximized my legitimate deductions.

If you're dissolving your LLC and need to talk to the IRS about any tax implications, good luck getting through to them! I spent WEEKS trying to get clarification on how to handle my business closure. After 17 attempts and being disconnected repeatedly, I found this service called https://claimyr.com that got me through to an actual IRS agent in under 30 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c They basically navigate the IRS phone tree for you and wait through all the holds, then call you when they have an actual human on the line. I had specific questions about how to report my business dissolution that weren't covered in the standard forms, and getting direct answers from an IRS rep saved me from potentially misreporting.

I need to eat my words about Claimyr being a scam. After my skeptical comment, I decided to try it myself since I needed to sort out an issue with reporting my closed business on my taxes. After numerous failed attempts to reach the IRS myself, I gave Claimyr a shot. It actually worked exactly as described. I received a call back in about 40 minutes, and suddenly I was talking to a real IRS representative. Got clear guidance on how to properly report my business losses after closing my LLC and what forms I needed. Saved me hours of frustration and possibly from making filing errors. Sometimes it's worth admitting when you're wrong!

One thing nobody has mentioned yet - make sure you're keeping your LLC open until at least after you file taxes! I dissolved mine too early last year and it created a paperwork nightmare. My accountant had to jump through extra hoops to prove the business was legitimate since it was already closed when we filed.

Does anyone know if there's a time limit on how long you can carry forward business losses if you can't use them all in one year? My LLC had way more losses than my personal income could offset.

Great question! I was in a similar situation last year with my consulting LLC. You can absolutely deduct those business losses against your personal income even after dissolving the LLC. Since single-member LLCs are disregarded entities for tax purposes, the losses flow through to your personal return on Schedule C. A few important things to keep in mind: - Make sure all $13k in expenses were legitimate business expenses incurred while the LLC was actively operating - Keep detailed records beyond just bank statements - receipts, invoices, and documentation of business purpose for each expense - Consider timing your dissolution after you file taxes to avoid potential IRS scrutiny (as Emma mentioned above) The losses can offset your W-2 income dollar-for-dollar up to the excess business loss limitation ($289k for 2023), so your $13k loss should fully reduce your taxable income. Definitely work with your tax professional to ensure everything is properly documented and reported.

I dealt with this exact situation when I closed my failed e-commerce LLC two years ago. You can definitely deduct those business losses against your personal income - the key is making sure you have proper documentation for every expense. One thing I learned the hard way is that the IRS pays extra attention to business loss deductions from dissolved entities, so organization is crucial. Beyond bank statements, you'll want receipts, invoices, contracts, and anything that proves the business purpose of each expense. Also consider the timing of your dissolution carefully. If you dissolve before filing taxes, you might face additional scrutiny and documentation requirements. I'd recommend keeping the LLC active until after you file your return for this tax year. The good news is that legitimate business losses can significantly reduce your tax liability. My $11k in losses from my failed venture ended up saving me about $3k in taxes when applied against my W-2 income. Just make sure your tax professional reviews everything thoroughly - it's worth the extra cost to avoid potential issues down the road.

I've been through this exact scenario with my marketing consultancy LLC that I dissolved last year after accumulating about $12k in losses. The good news is you can absolutely deduct those business losses against your W-2 income even after dissolving the LLC. A few key points from my experience: **Documentation is critical** - Bank statements alone won't cut it. The IRS will want to see receipts, invoices, contracts, and clear business justification for each expense. I recommend categorizing everything by expense type (office supplies, software subscriptions, marketing costs, etc.) to make your CPA's job easier. **Timing matters** - Consider keeping your LLC active until after you file your tax return. I dissolved mine too early and it triggered additional IRS questions that delayed my refund by several months. The extra few months of minimal state fees were worth avoiding the headache. **The tax savings are real** - My $12k in losses reduced my taxable income dollar-for-dollar, saving me about $3,200 in federal taxes (I'm in the 26% bracket). Since you're well under the $289k excess business loss threshold, your full $13k should be deductible. Work with a qualified tax professional who has experience with business dissolutions - they'll know exactly what documentation the IRS expects and can help you avoid common pitfalls that trigger audits.