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I formed an LLC in October 2008--due to some family issues, I was not able to obtain my Federal Tax ID number until May 2009. Due to other set backs, I have not been able to officially start my business (Home Staging and Redesign) until now, Oct. 2009. My question is this, I am a sole owner, sole employee--with no profits just expenses at this point--what types of forms did I need to file for tax purposes and when should I have done it--or am I okay until April of next year?

Submitted: 39 days and 23 hours ago.
Category: Finance
Value: $15
Status: CLOSED
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Country/State/Province of question: NC

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Accepted Answer

Single member LLC is disregarded entity - and all income and expenses is reported on the owner's individual tax return.

However - if the business was not started in 2008 - all expenses are considered start-up expenses.

 

Start-up cost - expenses you had before the business started - in general should be amortized over 15 years.

You can write off up to $5,000 in startup costs and another $5,000 in organizational expenses in the year that you start your business - thus in the first year you will deduct 1/15 part of the total expenses - and so on in following years.

If you haven't started the business yet - you may not deduct any start-up cost.

please see more details in the IRS publication 334 - http://www.irs.gov/pub/irs-pdf/p334.pdf

 

Let me know if you need any help or clarification.

 

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Expert: Lev
Pos. Feedback: 99.1 %
Accepts: 
Answered: 10/13/2009

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Personal Investment, Tax Preparation

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