Legal Question in Business Law in Michigan

Not Making Money (in the red)

So I run a business as an LLC in Michigan. Every year I am in the red due to expenses. I also have a Full Time job in which I make money at. Will I run into any problems being in red with my business? Its more a thing I enjoy to do and make some to cover the cost of equipment and expenses. year 1 was 8k in red. year 2 was 7k in red. but its all financed through the money i make in my Full Time Job. My business is more a fun hobby job that i do bring in some case. income year 1 was 2600. income year 2 was 3800. i still had the above losses even after the stated income.

Thanks!


Asked on 1/22/09, 8:19 pm

1 Answer from Attorneys
Patrick Tracy Patrick J. Tracy, Esq, P.E.,

Re: Not Making Money (in the red)

There is nothing wrong with your business model. The thing that would be questioned is that after a number of years you were still running the business at a loss and it could not be proved that this was not a general tax avoidance scheme.

You, from what you state, are in the up and up right now.

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Answered on 1/23/09, 6:36 am


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