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Hi Hi, my client opened up a start-up company last year. The business has zero income but incurred around $30k in expenses. Will it make any difference to his tax return if we select to take the $5000 start-up cost deduction?
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That sounds like a really good question for them to present to their tax professional. That person will have the complete picture of all of the aspects of the tax return.
Answers are easy. Questions are hard!
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Did the business really open last year?
The more I know the more I don’t know.
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Read IRC section 195.
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If they opened up the business and had $30K in expenses but zero income, it sounds like someone forgot to unlock the front door of the business.
Slava Ukraini!
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thanks everyone for your reply. Yeah... they started their business last year and are in the R&D stage of the business.
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Then read IRC Section 174, too.
The more I know the more I don’t know.
