RESTAURANT START UP COST AND ASSETS

[Tiger5]

I have a client that started a business in Oct 2021. registered as a partnership and Has start up cost from 2020.  

building cost 71,071.00 - should be put in as an asset and depreciated over 15 years. 

expenses 24,566.99 - which include labor,repairs,lawyers, material, utilities, equipment. - can i put this also on the asset worksheet?  

They also have 25,281.73 in equipment that i should put as an asset as well?

i can expense 5,000.00 and the rest goes in capitalize cost for the term of 15 years. 

the business started in 10/2021 and only has sales for oct, nov, dec 2021. not much. 

what are the forms i should use? i researched that i should use for 4562 and add asset worksheet. im using proseries as the program. i want to make sure i am using the correct forms and not missing anything.  

[qbteachmt]

For the 15-year issue: "Building" as in the Real Estate on some property? Or, "building Out" as in, improving the real property they are leasing? See:

https://www.jccscpa.com/bar-restaurant-industry-irs-depreciation-changes/

For some details. You want to separate "cost" as Expense, and Cost as invested in the asset. And, group assets for same Type. Lawyers and Fryers are not the same asset. And the lawyer was for the entity or the business? Utilities are operating costs, and "materials" can be lots of cheap stuff that won't last very long, or a few expense things that will last a while. That means understanding Asset vs Expense and Safe Harbor rules.

[sjrcpa]

Labor, material and repairs probably add to the Building Basis.

Building gets depreciated over 39 years, unless you mean buildout as qb alluded to.

Equipment gets depreciated separately  5 or 7 years as appropriate..

Lawyer could be Organizational expense - separate intangible. Or? What was it for?

[Tiger5]

Thank you

[Tiger5]

thank you