Question

Gig income might skip a year only to pick back up again the next year so how do we report when started?

Forum|Forum|2 years ago
October 9, 2023
2 replies
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If we do several different types of businesses/gigs but some years we don't participate however, pick up a year later, how do we answer "did you start this business this year"? And "when did you start this business?"

Example: Say we started a new gig in 2020 but didn't participate at all in 2021 only to start the gig back again in 2022, how do we answer, when did we start? Won't the skipped year of 2021 look odd?

Some years my husband played in a band. Some years he didn't. Some years he did carpentry, some years he didn.t. So if he picked carpentry back up in 2022 for example but nothing for 2021 was earned or noted on 2021 tax return, does this look out of place?

Not A Product Question

A

Anonymous_

Employee

I'm going to page @Mike9241 and @Critter-3 for input.

However, aside from recovery periods for assets used in the businesses (i.e., depreciation), the answer as to when the business started is somewhat immaterial.

M

Mike9241

different gigs require separate reporting. if he did bands in 2020 that's one buisness. if he did carpentry in 2022 that's a new business

if he did both in the same year he would need to file 2 schedule C's (undelss in a partnership, S-corp or C-Corp)

each type of business has has a seoarate principal business code. which must be entered on the resopectibve schedule C. so if started carpentry in 2022 the answer is yes he started a new business. the Schedule C for the band may have to be deleted. if and of itself a diferent businesses does not increase audit risk. Howevr, some returns are chosen purely at random and others are flagged becuase something stands out or the iRS gets 1099's for income and the taxpayer reprts less .

P

planetm69Author

Ok cool. So if in 2022 using this example, if he didn't play with the band that year and started carpentry work but picked it back up (playing with the band) in 2023, does he state he started playing with the band in 2023 or is the start/end date completely unimportant and only used for Turbo Tax input?

And for depreciation, if he writes off tools and takes an annual deduction, can that affect future tax returns if he no longer works as a carpenter at some point?