I have a client who has had a business that they have operated for the last 10 years, but have never recorded a significant profit for the business.  This year, another significant loss, and the client raised the question if they needed to provide the tax schedules for the business they operate on their schedule C.  This is a sole proprietorship that they intend on turning into a profitable business, but do not want to raise the red flag to the IRS for an audit.  

There feeling is to withhold reporting anything for the business, but I'm concerned the IRS will then see this as a terminated business making it more complicated in the future.

Please let me know your thoughts.  Thank you in advance!

Tom