Can this be explained to me a little better? I am not sure that I understand it.

I was informed that as an in home daycare, if my deductions,expenses, depreciations etc... exceed my years income, then the HOME portion of expenses will rollover into next year... (that might be paraphrased slightly)

I only made 3300.00 this year from my daycare, my direct 100% expenses combined with my start up expenses (legal contracts, inventory deduction, crafts supplies, standard meal deduction, items bought for specifically for daycare, gift deductions etc etc.) exceed the 3300$ that I made. We had anticipated this would happen our first year but that doesn't even get into my T/s% deductions, such as mortgage interest, vehicle expenses, Utilities etc..

I had a pt job outside the home this year for 10 months as well and I only made about 1500$ at that, but I did have all the normal taxes/ss/etc withheld,as well as an extra 10$ per pay check and claimed ZERO.

I know I will have Self employment taxes to pay as I have not paid anything in this year for the daycare (i wasnt sure when or how.. but have since figured that out)

So what happens when All my deductions and depreciations etc exceed my income? Do I lose any of the deductions?

I file jointly with my husband who has foreign income (Australia) as well as US income, is tax exempt in our home state (MO) where I am not, and he pays taxes in LA where I do not. Complicated much?

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