Discussion:How to claim startup costs
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| I want to deduct my equipment and whatever I am allowed on my vehical (2004 - Avalanch) to reduce what I might owe on my employed and retirement income. So, Can I do this ? and if I can | I want to deduct my equipment and whatever I am allowed on my vehical (2004 - Avalanch) to reduce what I might owe on my employed and retirement income. So, Can I do this ? and if I can | ||
| How much buisness do I have to show in subsequent years so the IRS doesnt dissallow my startup costs, calling it a hobby..and wanting their money back...}} | How much buisness do I have to show in subsequent years so the IRS doesnt dissallow my startup costs, calling it a hobby..and wanting their money back...}} | ||
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| + | {{ForumReplyPost|UserID=Anuenue|Date=7 December 2005|Text=All your answers are in the Small Business Publication from the IRS. | ||
| + | Set up costs are amortized. Equipment is depreciated. You can take additional depreciation but it could be a waste of money to take the maximum allowed. | ||
| + | If the business is a loss for three out of five years the IRS generally considers it a hobby. | ||
| + | anuenue}} | ||
Revision as of 20:39, 7 December 2005
Discussion Forum Index --> Tax Questions --> How to claim startup costs
| 7 December 2005 | |
| Here is a complicated question ...
I lost my normal job in June, they paid me 6 months severence, total yearly payout so far .. about 100k. To survive I had to pay off most of my bills, plus cash in a piece of my reteirment bucket (another 60K) Total now 160 K . I decided to start up a small buisness, bought 25 k worth of equipment, plus 5 k of material. I sold about 5 k so I am breaking even at this point .. living off the bank. This is not working well enough to survive, so I am going to take another regular 9-5 job. Plus keep the buisness open on the side. ... I want to deduct my equipment and whatever I am allowed on my vehical (2004 - Avalanch) to reduce what I might owe on my employed and retirement income. So, Can I do this ? and if I can How much buisness do I have to show in subsequent years so the IRS doesnt dissallow my startup costs, calling it a hobby..and wanting their money back... | |
| 7 December 2005 | |
| All your answers are in the Small Business Publication from the IRS.
Set up costs are amortized. Equipment is depreciated. You can take additional depreciation but it could be a waste of money to take the maximum allowed. If the business is a loss for three out of five years the IRS generally considers it a hobby. anuenue | |
