In '05, I had no self-employment income (had sold all contracts in '04), and was counseling kids as an employee.

I DID have expenditures (time and travel) related to bankruptcy proceedings in 04/05. One of my accounts burned me for $4k+ in US Bankruptcy Court in Charlotte. Zero on the dollar.

Do I need to complete a Schedule C for 2005 for those losses?

(I have not filed '05, since I had no tax liability for '05 income as a payrolled employee, but this might change my refund from about $12 to maybe a C-bill or so...)

Did you file taxes after 05? Did you have business income after 05?

You should have included the losses on your 05 return. The losses could have been deducted against business income up to the equal amount. Any loss over income should have been carried forward to 06 to offset income as well. It's been a while since I was in the tax business, so I don't remember how it affects income not generated from a business or capital gains. Check with your accountant.

Matthew

Quote:

Thanks...

Never filed the '05 return - no liability, no self-employment or SE income, but a small return due from payroll earnings.

Now we're doing the '05 filing, and there is the expense/loss for the bankruptcy proceedings that's related to '04 earnings, AND, carryover home office expense from '04 that was never calculated into '05, again, because there was no self-employment, no Schedule C.

Both of those 2 extra factors should substantially increase my refund.

The question is, I apparently must do a Schedule C self-employment for '05, even tho' I wasn't self-employed that year. '04 1040x would NOT encompass home office expense carryover.

The bankruptcy-related expenses were incurred in '05, and, the home office expense is ALWAYS carried over to the next year' filing.

???