How do I enter a loss in the income line?

[nat_marjie]

for self employment income -- how do I enter a loss figure for 2020?

[Surajth]

We appreciate you choosing TurboTax,

If you suffer a loss from unpaid debt or selling shares of a small business corporation, you do not have to declare these losses as capital losses. Rather, you can declare them as allowable business losses. There is no requirement that these items were sold for cash. You may be able to claim a business investment loss (ABIL) if you disposed of these items for nothing.

The debt must be considered bad or unrecoverable at the end of the tax year in order to qualify. In addition, if you are claiming a small business investment loss for shares, the company must have gone bankrupt, be insolvent, be in the process of winding up, or have no fair market value.

Your allowable business losses can be applied to your sources of income, unlike capital losses which can only be applied to capital gains. If your loss exceeds your other income, the difference can be carried forward or back as a non-capital loss. Calculate the loss amount on Chart 6 of the T4037 Capital Gains form, then report it on line 21699 and line 21700. The total ABIL should be reported on line 21699, and the amount that can be claimed based on your income should be reported on line 21700.

TurboTax Premier offers an easy step-by-step guide for reporting your investment income and claiming your losses or carrying them forward. TurboTax Self-Employed allows you to easily manage your rental and business earnings, expenses, and claim losses. 

If you feel overwhelmed, you might want to consider TurboTax Live Assist & Review, Self-Employed, which offers unlimited help and advice as you do your taxes, plus a final review before you file. Choose TurboTax Live Full Service for Self-Employed* to have a tax expert complete your return from start to finish.

Please read the following link for further clarifications:

TurboTax: Losses and How to Claim Them on Your Taxes

TurboTax: Guidelines for Reporting Self-Employment Income

Please contact our phone support team or contact us directly on Facebook or Twitter if you require further assistance.

Thank you.