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When you incur costs to setup a business, those are organizational expenses. These are capitalized and deducted over a term of 15 years.
Setting up a subsidiary is essentially setting up a new company
Since we own the subsidary company, let us say we invested 100K to set up the manufacture facility, the shipping center, etc, and 100% own this company, so the 100K we invested this year is considered as the business cost and could be deducted from this years revenue for tax purpose, correct?
No, it's a setup cost for the new company. It would be organizational costs and would be deducted over 180 months
which means it would be deducted like 7% each year, right?
Yes, that is correct. But, keep in mind that the cost of setting up equipment etc is capitalized as part of the basis in the asset
magan, I need to leave now, can I catch up with yo a bit later. also can you tell me quickly how I pay you the $30.00. thanks
Yes, you can catch up with me later. You pay me the funds by rating me positive.
So, click 3-5 stars. You can come back to this page at any time to ask a follow up even after you rate.
The rating feature is along the bottom of your screen
I'm also on about 18 hours a day so I should be here when you get back