Small Business Tech Tips

You may have missed it, but there was a very important article in the WSJ today titled “Entrepreneurs win tax case versus IRS”?

This could be a big win for small business owners, many of whom are structured as LLCs or LLPs.

The ruling in the case says that an entrepreneur can now use losses in one LLC or LLP to offset their income from another LLC or LLP.

That’s a big benefit to the small entrepreneur that has multiple irons in the fire.

Let’s say you have two businesses going. In one, you have losses of $175k. In the other, you received an income of $200k. Under the tax rules that have governed up until now, you would be taxed at $200k in income for the year, not receiving any tax benefit from the losses you incurred.

According to the new rules, you would only be taxed at $25k, because the $175k in losses can be used to offset your income!

Talk to your accountant and see what you can do to take advantage of this.

Mike Cooch
CEO
Everon Technology Services, LLC

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Tags: llc, small business, taxes

This entry was posted on Wednesday, July 8th, 2009 at 5:32 am and is filed under Small Business Management Tips. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.