Amortization from business startup costs in COGS

I'm preparing an 1120S. This is the first year I've prepared the return in TurboTax. (It was prepared at H&R block in previous years.) I entered the business startup costs that were incurred in 2019 so I can continue amortizing them. The amortization keeps showing up on Line 2 of the 1120S as cost of goods sold. No goods are sold in this business. How do I stop it from appearing there? I assume it should be on Form 4562 part VI.

968

Expert Alumni

Mar 12, 2023 8:01:51 AM

You need to add the startup expenses as an asset in TurboTax. You will see an option to enter assets for your business when you update your business entries. You will see a screen that says Describe This Asset, and you need to choose the Intagibles, Other property option. On the next screen you will see Tell Us a Little More about this asset, to which you will choose Amortzable intangibles. You will see an option on the screen that says Select a Code Section for the start up expenses, and you will choose code 195. Then the expenses will populate on Form 4562 on page two Part VI, line 42.

Level 2

Mar 13, 2023 9:48:35 AM

Thanks

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Amortization from business startup costs in COGS