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Interest expense limitation

Forum|Forum|4 years ago
August 18, 2021
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I am a self-employed (graphic designer) and some interest due to some investment in expensive hardware.

It's not really clear for me if there is a limitation or not?

I found in the IRS documentation that :

"The business interest expense deduction allowed for a tax year is generally limited to the sum of:

1. Business interest income,

2. 30% of the adjustable taxable income, and

3. Floor plan financing interest."

But I'm not sure if Turbotax handles it automatically or if I should be careful of that?

Best answer by Anonymous_

If you are a small business taxpayer ($26 million or less in gross receipts) then you are not subject to the Section 163(j) interest expense limitation.

TurboTax does not support Form 8990 and, as a result, would not calculate the limitation and carryforward for taxpayers subject to the limitation.

A

Anonymous_Answer

Employee

If you are a small business taxpayer ($26 million or less in gross receipts) then you are not subject to the Section 163(j) interest expense limitation.

TurboTax does not support Form 8990 and, as a result, would not calculate the limitation and carryforward for taxpayers subject to the limitation.