Tax reform sticks it to business startups that lose money

Ernie Neve, CPA

January 19, 2019

There’s a provision in the Tax Cuts and Jobs Act that we believe is terribly unfair to business start-ups and struggling business owners.

You see, the rule prevents you from using all your business losses against non-business income if the losses are considered to be too large. (That determination is made by Congress.)

If you want to find out how this onerous new law can affect your business, take a minute and read my new article titled TCJA Tax Reform Sticks It to Business Start-Ups That Lose Money.



1. We’ll explain how this nasty new rule works. Under new Code Section 461(l), if your overall business loss exceeds $250,000 (or $500,000 on a joint return), you can’t use the excess loss in the current year and have to treat it as a NOL carryforward to the next year. We believe this provision particularly impacts real estate investors, real estate professionals, and owners of start-up businesses. You’ll get the whole story when you Read my new article.

2. You’ll learn how the IRS defines a new tax term . . . “excess business loss.” To determine your excess business loss, you’ll need to follow these steps that we’ll explain in detail. And if you do wind up with an excess business loss, we’ll tell you the three things you need to do to comply with the law. All will be explained when you Read this new article.

3. We’ll show you how to fight back and win. To avoid big problems, you’ll need to keep your overall business loss to no more than $250,000 (or $500,000 joint return). The two best ways to make this happen is to accelerate business income and delay business deductions. And that’s just for starters. We’ll have many other practical ideas for you when you Read the article.

If you are not yet a subscriber, CLICK HERE. You’ll get a no-obligation 7-day FREE trial during which you can read, not only the article I mentioned above, but all of our helpful tax-saving tips. This trial is absolutely free and there are no strings attached. That’s a personal promise.

If you’re already a subscriber to the Tax Reduction Letter you’ll be prompted to log in when you CLICK HERE.

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