Limit on SMLLC deductions


R

Roman

My understanding is that, on my individual tax return, I can
deduct business expenses up to the amount of business
income, and it is irrelevant whether portions of the
business income come from different sources. Is this
correct?

Here is an example to clarify the question: suppose, I have
a W-2 job that pays $100,000 in a given year, and, in the
same year, I also make $10,000 doing independent consulting,
and, in the same year, an LLC I am a single member of, makes
$5,000. Then, what would be the maximum amount of LLC
business expenses that I can deduct on my individual tax
return? Would it be $5,000 (LLC income), $15,000 (LLC
income + independent consulting income), or neither?
 
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