Final answer:
Julie's 2022 net operating loss (NOL) is $22,950, which is calculated by adding her Schedule C net loss of $40,000 to her wages of $30,000 and then subtracting the standard deduction of $12,950.
Step-by-step explanation:
To determine Julie's 2022 net operating loss (NOL), we need to consider her income and the standard deduction she can claim. Julie has a Schedule C net loss of $40,000 from her business and wages of $30,000. Her only other deduction is the standard deduction of $12,950 for 2022.
First, we need to calculate her adjusted gross income (AGI) by adding her business loss to her wages:
AGI = Wages - Schedule C Net Loss
AGI = $30,000 - $40,000
AGI = -$10,000 (a negative amount indicating a loss)
Since Julie's AGI is negative, we then subtract the standard deduction:
Taxable Income = AGI - Standard Deduction
Taxable Income = -$10,000 - $12,950
Taxable Income = -$22,950
Julie's taxable income is also negative, which means she has a net operating loss. Her NOL would be the amount of her negative taxable income, which is $22,950 for the year 2022.