Once you open your business and start generating revenues, you can write off many of those initial startup costs at tax time.
But there is bad news too. The rules for taking advantage of these deductions are not as straightforward as they are for your business’s ongoing expenses.
Here are six steps to getting deductions for your pre-opening business costs.
- Track your startup costs. Begin at the beginning.
- Track your organizational costs.
- Take an upfront deduction if you qualify.
- Depreciate your initial equipment and furniture, too.
- Get a tax benefit for merchandise you first bought for yourself.
- Have lots of startup costs? Put off what you can.