Question

Neg income

Forum|Forum|5 years ago
July 16, 2020
1 reply
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My question is how do I adjust a negative income? The following is what the program is asking me to do, and I do not know or understand what they are asking...??

The business income of -13.170 needs to be adjusted.

Deductions from other topics are related to the business...

This business received Form 1099-PATR.

The wages of $3104 for this business need to be adjusted.

Confused on select one or hit continue...??

Sheri

Spino

Employee

Overall, it sounds like you might benefit from showing your tax return to someone more experienced. This sounds like it could be several errors, or maybe just a typo or entry in a wrong box. I'll just follow this with some comments that might (or might not) help you figure out some next steps 🙂

When your income is negative for a business (I'm assuming Schedule F, sole proprietorship farm, reported on 1040), there may be some deductions you can't take. You don't say exactly where these messages appear, so I'm trying to piece together the information you provide:

--You show a negative business income. In the US, we use a comma to separate thousands from hundreds, so I'm guessing you mean -$13,170.00 as opposed to -$13.17. This means that your expenses exceeded your income by $13,170. Some deductions can only be taken when you show a profit, but it is certainly possible to spend $13,000 more than you make, especially on a farm.

-you had wages paid to others of $3104. Remember that any wages listed (usually over $400) or payments made to individuals by your business over $600 must be supported by your business filing information returns, and possibly wage returns. TT Home and Business supports this, separately from filing your 1040. [This should not include any money you took for yourself from the business.]

-You had income from a coop etc. reported on 1099-PATR (1099-patronage). Here are some instructions from IRS publication 225:

"You generally report patronage dividends as income on Schedule F for the tax year you receive them. They include the following items.

Money paid as a patronage dividend, including cash advances received (for example, from a marketing cooperative).
The stated dollar value of qualified written notices of allocation.
The fair market value of other property.

Don’t report as income any patronage dividends you receive from expenditures that weren't deductible, such as buying personal or family items, capital assets, or depreciable property. You must reduce the cost or other basis of these items by the amount of such patronage dividends received. Personal items include fuel purchased for personal use, basic local telephone service, and personal long distance calls.

If you can't determine what the dividend is for, report it as income on Schedule F, lines 3a and 3b."