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cassandra-macken
New Member

Re: starting a business, if my business will open on 1/1/18, can I deduct business startup expenses from 2017 when I file my 2017 taxes?

Because itemization will change under the new tax plan, I'm wondering if I should spend more on business startup costs in 2017 (instead of 2018) to take advantage of business startup deductions NOW.

1 Best answer

Accepted Solutions
Opus 17
Level 15

Re: starting a business, if my business will open on 1/1/18, can I deduct business startup expenses from 2017 when I file my 2017 taxes?

No and no.

Itemized personal deductions are changing, but most of the rules for deducting business expenses on schedule C aren't changing.

You can't deduct business expenses on schedule C if you don't have income to report.  Instead, you report your startup expenses in the first year you have income.  The first $5000 of startup expenses can be taken as an expense deduction.  If the amount of startup is more than $5000, some part can be taken as an expense in the first year and the rest is amortized over 15 years.

Also, the tax bill made depreciation of certain types of equipment or assets that you buy for work more favorable starting in 2018.  

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*

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1 Reply
Opus 17
Level 15

Re: starting a business, if my business will open on 1/1/18, can I deduct business startup expenses from 2017 when I file my 2017 taxes?

No and no.

Itemized personal deductions are changing, but most of the rules for deducting business expenses on schedule C aren't changing.

You can't deduct business expenses on schedule C if you don't have income to report.  Instead, you report your startup expenses in the first year you have income.  The first $5000 of startup expenses can be taken as an expense deduction.  If the amount of startup is more than $5000, some part can be taken as an expense in the first year and the rest is amortized over 15 years.

Also, the tax bill made depreciation of certain types of equipment or assets that you buy for work more favorable starting in 2018.  

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
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