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Tax Write off

Discussion in 'BlackHat Lounge' started by freething, Feb 24, 2012.

  1. freething

    freething Registered Member

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    I have 2 questions

    (1)I was wondering if an "affiliate program" is seen as a "home business" for tax purposes?

    (2)Do i have to make a profit in that year to be eligible for the write-offs?
     
  2. ET-call-home

    ET-call-home Newbie

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    It depends on which country you are but in the most countries

    1. Yes - if you mean you are promoting products as affiliate.

    2. No - you don't need to make profit to offset expense in each year. If you make loss in one year then you carry forward that loss to next year. And if you make profit in 2nd year then you can deduct last year's losses. If you don't make profit in 2nd year then you carry forward losses from Year 1 and Year 2 to Year 3. Then if you make profit in Year 3 then you deduct losses for Year 1 and Year 2.

    Now if you make losses again Year 3 then Tax Man will start looking into your accounts.

    Thanks
     
  3. LBrown

    LBrown Senior Member

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    Yes, after two years of losses it is no longer a home business but a hobby and you can't deduct expenses.
     
  4. freething

    freething Registered Member

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    ok Thank you all!!