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Pre S corp start-up expenses
10/17/09 9:36 AM, Viewed by asker 10/19/09 3:56 PM
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Total Views: 113
Are business expenses incurred in starting an S corp tax deductible even though they were incurred prior to the official corporation start date e.g. purchasing computer, filing fees, legal expenses?
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10/17/09 3:56 PM
Yes these get entered by journal entry to start up costs.
Marc Barnes
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For business start-up and organization costs paid or incurred after September 8, 2008, a corporation can deduct up to $5000.00 of such costs for the year it begins business. The $5000.00 deduction is reduced by the amount the total cost exceeds $50,000.00. If the total costs are $55,000.00 or more, the deduction is reduced to zero. Any costs not deducted must be amortized over a 180 month period, beginning with the month the corporation begins business.
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