I live in Massachusetts and want to write off business expenses for a sole proprietorship as tax deductions. Can you do this as a sole proprietor or do you have to register as a corporation or LLC?
I live in Massachusetts and want to write off business expenses for a sole proprietorship as tax deductions. Can you do this as a sole proprietor or do you have to register as a corporation or LLC?
If you conduct a business as a sole proprietorship then you report your income from that business on Schedule C, which is a form that gets attached to your Form 1040. Depending on the details of your business you may have other forms and schedules you must complete as well, including Schedule SE which is where you compute your self-employment tax (Social Security and Medicare taxes for self-employed persons). Most of your business expenses may be deducted right on Schedule C. However, amounts you pay for items used in the business that will last longer than a year, like computers, cars, office equipment, cell phones, etc., will require other forms. IRS Publication 334 provides a pretty complete tax guide for self-employed persons.
I suggest you see a tax professional for help with the return, at least for the first year, since it appears you are not at all familiar with how this works to ensure you get it right.
