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Itemized Deductions Schedule-A


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Old 12-09-2014, 07:13 PM
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Starting a New Business and Deductions

I have roughly $12k in business expenses related to launching a start up. I am fully employed by another company and I don't yet have my LLC formed. Can I claim these start up costs on my personal taxes without an LLC or business liscense? If not can I start the LLC in January of 2015 and still claim the expenses from 2014?



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Old 12-10-2014, 08:23 PM
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Originally Posted by gregnet View Post


#1;I have roughly $12k in business expenses related to launching a start up. I am fully employed by another company and I don't yet have my LLC formed. Can I claim these start up costs on my personal taxes without an LLC or business liscense?


#2; If not can I start the LLC in January of 2015 and still claim the expenses from 2014?
#1; If you are investigating a specific biz to start or buy, and the deal doesn't work, you can still deduct your personal expenses on Sch A of your Form 1040 as "miscellaneous expenses.
If you are searching for a business but have no specific business in mind, and you decide not to buy any business, you cannot deduct these expenses as they are not related to any specific business. So, if you ultimately decide not to go into business, the portion of costs you paid to generally investigate the possibilities of going into business at all, or to purchase a non-specific existing business, are considered personal costs and are not deductible
#2;yes. a s you can see, start up costs are handled differently from ordinary business expenses. You get a limited deduction ,$5k in the first year that the business is up and running and them amortize the rest over a period of 180 months for 15 years. If your business was not up and running in 2014 but is in 2015 then you need to start deducting start up costs in 2015. If it was up and running in 2014, that's when you start deducting start up costs.



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