I need someone's help. I got a gift of money from my uncle and a business license to try to start a home based business at the end of 2006. Needless to say I didn't do anything with the money (just opened a business account) nor the business and I didn't claim the money on my 2006 return and now I quess I need to amend the 2006 return to include the income. The only thing is is that I didn't 1099 myself (which I could easily do) or do anything else in regards to the business. Will I have to do anything else in regards to the business taxes or do I just include the income on the 1040x and submit it??

Are you talking about amending your return to include the gift you received from your uncle because the person who gave the gift is the one subject to tax on it, depending on the amount of the gift, not the one who received it.

Yeah but wouldn't it be considered money my business received since he made the check to my business name and I put it into a business account??

Gifts to a corporation or other business entity intended for eventual use or benefit of an employee, stockholder or owner, when it can be reasonably ascertained who that individual will be, in this case you, are considered as made indirectly to the individual. So although he made the check out to the business, if it was indeed a gift, and not a loan to be paid back or a check for goods or services that the business provided to him, then it was still a gift to you. And depending on the amount of the gift, it is taxable to your uncle. In terms of your business books, if the situation I have described fits, then you treat the deposit to the business account as a capital investment by you the owner or shareholder, then assuming the money was not used for anything business related and just withdrawn, you treat it as a distribution back to you. So unless it was received in exchange for business goods or services, it is not income to your business.