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pattycake8989
April 16, 2021
Question

Should I amend my 2019 return or do it on my 2020 return

  • April 16, 2021
  • 1 reply
  • 0 views

I closed my direct sales business in 2019 but I wasn't aware that my EOY inventory needed to be at 0. So my Schedule C from 2019 shows an ending inventory. Do I need to amend my 2019 return or carry it forward as BOY inventory on my 2020 return and make sure 2020's end of year inventory is at 0 by transferring it all for personal use? How will this affect my refund...will I have to pay taxes on the inventory that I transfer for personal use?

    1 reply

    ColeenD3
    ColeenD3
    April 18, 2021

    You can do either. The main reason to answer the question is to answer the follow-up question.

     

    If you’re self-employed and simply stopped doing this type of work, answer Yes here.

    You'd also answer Yes if you own a business and you did one of these things:

    • Closed the business
    • Sold the business
    • Lost the business in a fire or other disaster
    • Retired from this business

    P
    pattycake8989Author
    April 18, 2021

    I closed the business due to not enough business to make a profit. I did not sell the business.

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