How to deduct business startup cost while filing tax return?
My business opened in January 2007, but I investiged $20k on starting the business, renting and remodeling facility and purchasing equipment in 2006. When filing tax return for 2006, can you deduct all these startup costs? Any special things should I pay attention to?
Answers (1)
IRS code section 195 deals with start up costs. To deduct them you must file an election with the tax return for the year of the expense. Then you amortize the costs over a 5 year period.
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Jim Eaton
