tklucky13
Level 1
07-15-2020
11:01 AM
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Has anyone worked with a client who owns a hemp business? They purchased $150,000 in hemp and $40,000 of it was moldy and could not be used. Can they take a loss on the Schedule C?
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TaxGuyBill
Level 15
07-15-2020
11:16 AM
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Yes the expense of the $150,000 can be taken on the tax return. That full amount can be used as a deduction, whether or not there is income from $40,000 of it. But you don't enter the $40,000 anywhere because you are already getting a deduction from the $150,000. The year-end inventory count will give it the deduction.
