Can I take a profit/loss deduction?
I started up a Medical marijuana farm and was busted. Besides the jail time and large fine, the gov. estimated value at 400K. Between grow equipment and crop loss I estimate the loss to be that amount also. While doing taxes I found the schedule f farm loss sheet and wondered if I am entitled to make a claim? I own a business and have a tax #. I tried to get tax stamps and permits before the grow but I needed to produce the product before I got the permit. I was also told I would be in violation if I produced the product prior to receiving the permit. So I would have to break the law to get the permit and stamp and that is where I was at when I was busted. Can I take the loss as a deduction?
No.
You can not take a deduction on your tax return for costs related to illegal activities or fines.
Sorry, Dude, but since the activity is illegal you are taxed on your gross receipts without any allowance for what would otherwise be allowable business expenses.
Medical marijuana farm? Trolls are losing their creativity.
your business was illegal and cannot be claimed as a loss
conversely, had you made money, it would have been declared in tax returns, but that is the way the system works, you are not rewarded for being illegal but if you make money illegally, you must pay the piper