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Anne
Anne, Master Tax Preparer
Category: Tax
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Experience:  Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
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I am starting new business, I have invested $60,000 already

Resolved Question:

I am starting new business, I have invested $60,000 already but I may not be able to open for lack of capital. I will lose my lease soon. Can I write off this on my income tax?
Submitted: 4 years ago.
Category: Tax
Expert:  Anne replied 4 years ago.
Hi Tinrocker

Thank you for using justanswer. Are you asking if you can write off the unpaid rent, or are you asking if you can write off all of your start up expenses if you are never able to actually open your business? What kind of business were you trying to start and how was it going to be set up? Sole Proprietorship, Partnership, S Corp?

I'm trying to get a clearer picture of your situation so that I may more accurately answer your question.
Customer: replied 4 years ago.
I want to know if I can write off my start up expenses. It hopefully will be a dinner on one side and a cigar lounge on the other. We are a partnership and we incorporated
Expert:  Anne replied 4 years ago.
That helped a little. You can't be both a partnership and be incorporated, you must be one entity or the other, but under either entity, you may write off certain start up costs:

You may deduct up to $10,000 of Business Start-Up and Organizational Costs, even if you don't have the business up and running yet.

Please see below for more in depth information:

Publication 535 (2008), Business Expenses

I hope this helps.
Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 1703
Experience: Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
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