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Updated almost 7 years ago,
Tax Returns : Business Income - At Risk
So if I have a tax loss due to depreciation, etc., when I get asked on the tax software if the Business Investment is at risk, what is the correct answer? Is it All at Risk, Some at risk, or N/A? I have a hard time answering this because sure, it is an investment and therefore is at risk, all my tenants could move out and I could possibly never get it rented again, even though that isn't likely. It is renting just fine and therefore I am tempted to answer N/A, but since there is always some risk involved, I am curious if I am to answer "Some Investment is not at risk." This is my first rental I acquired in 2017 and therefore my first time including it on my tax returns. When I've had other business losses in the past, such as my wife's Real Estate business as a Realtor, I typically answer N/A since there are no real assets involved.
I appreciate any insight in what other more seasoned professionals tend to go with on that answer. Thanks!
- Don Spafford