No-Income Business?
TP pays big bucks for a windmill so they can sell electricity to the local power company. The previous CPA puts it all on a Schedule C in year one. In year two, we continue to depreciate the big windmill even though power generation income was under $500, resulting in a second year of Sch C loss. Now we're looking at year three, in which the windmill was under repair for most of the year and produced no income (power was used by the TP, but no excess power was sold to utility co). So now we're looking at a third year of Sch C loss. Are we still in our rights to call this a Sch C business? For all we know, the thing will generate lots of income next year if it's windy and working! If not a Sch C because no income, then what happens to the depreciation? It hasn't been abandoned and it isn't permanently out of service.Any help ... or cites ... would be immensely appreciated!
