New LLC sole proprietor in 2025

[kguadagno1]

What is the best resource to use to determine what is deductible as a business expense.  I do plan to get a CPA but wanted to do my own homework first.   Second - how should I document that a loan was made to the business from personal income as the business doesn't have any operating income yet, however has start up business expenses.    

[KrisD15]

Expenses are to be "Ordinary and Necessary" for the line of business. 

So, roller covers for a painting business would be acceptable for a paining business to expense, but perhaps not for a dog walking business.

The loan needn't be entered as a liability of the business on your tax return. You personally took out the loan, the interest would be a business expense. The principal on the loan was your personal asset and continues to be so. There is no separate equity account for a sole-proprietorship, whatever the company has is the same as being yours. 

If you took out a personal loan, and expenses were paid for the business, the business would show a loss for that year.

Some day when that turns around and the business makes a profit, you get that revenue back. 

[kguadagno1]

so to be clear, I do not have to document anywhere the use of personal assets/cash to pay for upstart business expenses

[MaryK4]

Correct- with a sole proprietorship (Schedule C) you and the business are the same, so you do not have to have the formal loan agreements and documentation.  Of course, you do need to keep track of the receipts and payments, which is why a separate business bank account is best.  @kguadagno1