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What is a short tax year?

I have heard about short tax year. Can you please explain what is it actually?

Suppose you started your business in the middle of June, and you want to file your taxes on a calendar-year basis, then the business will have a short tax year(less than twelve months). Your taxable income and expenses will be calculated for only 7.5 months.

Sub: #1 posted on Mon, 03/06/2017 - 06:09

Barbara Delinsky Barbara Delinsky

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If a businessman starts the business after the first month of the tax year or ends the business before the last month of the tax year, then the businessman will have a short tax year (less than twelve months).

For example: If you started your business on July 1, 2014, and went out of business on November 30, 2014

Sub: #2 posted on Wed, 03/08/2017 - 05:20

Sanders Patricia Sanders Patricia

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You will also have a short tax year if you move out of the country in less than a tax year. In such a situation, the last tax you pay will be a short tax year.
For example, if you plan to move out mid-year or suppose you're on VISA and you have to go back if it expires or your decide not to renew it.

Sub: #3 posted on Fri, 03/10/2017 - 03:16

Good Nelly Good Nelly
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Generally, taxes for short tax year are annualised. If you're self-employed, then your tax will be decided based on your actual self-employment income for the said short tax tenure.

Sub: #4 posted on Thu, 03/23/2017 - 05:09

paulcahill80 paulcahill80

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