Claiming A Loss For This Year

[DesertFlowers]

I am in the planning/preparing stage for starting a home daycare, and I will probably open sometime in October. My husband worked full time this entire year and I also worked full time for much of the year and I will continue to work part time until I open my daycare. Because of startup costs, time it will take to build up clients, and the fact that I am starting so late in the year, I am expecting to not make a profit from the daycare in 2011.

So, my question is, will the buisness loss reduce the taxes we owe on the income from my other job and my husband's job? Or are they figured separately?

In other words, If I had daycare expenses of $5000 for the year and made a $2000 income, would the $3000 loss reduce the taxes owed on our other income? Or maybe it would roll over to next year?

I thank you for your help....I have a lot to learn and am quite overwhelmed:confused:

[TomCopeland]

Loss

If your losses are a result of expenses shown on Schedule C, you can apply these to your joint income and reduce your family taxes. You can show a loss from expenses claimed on Form 8829 Expenses for Business Use of Your Home. If you had $2,000 income, $2,500 expenses on Schedule C, and $2,500 expenses on Form 8829 - you could claim no expenses from Form 8829 this year (because they can't create or increase a loss) but you can roll them over to 2012.