Alan L.
Elite Member
Business losses are deductible as long as you're in it for the profit. There is no hard and fast rule that you cannot have a loss 3 years in a row. If you don't show a profit in 2 out of 5 years the burden is on the taxpayer to prove that the business was entered into to produce a profit. Farms are the biggest target when they lose money regularly because of the opportunity to gain personal benefit from expenses treated as business expenses on the tax return.