I was told that I will not be able to claim more than $5,000 of expenses this year, they all have to be amortized over a long period.
That is true, and not just for a partnership either. On top of that, if your first year earnings are over a certain threshold, (50K I think) then the amount you can deduct in the first year is reduced. But any amount over that is just amortized (not capitalized) and deducted (not depreciated) over the next 15 years. (which is not a long period).
If you sell, close or otherwise dispose of the business before the 15 years is up, then any remaining amount is fully deducted in the last year of business.
You really should seek the services of a CPA/Accountant for at least your first year of business. Expecially if your state also taxes personal income. Doing it wrong can (and will) be costly down the road. I've seen/heard about my fair share of businesses going bankrupt before they even get off the ground, all because of fines, penalties and back taxes for having done things wrong from the beginning. Makes the cost of professional help in that first year seem like a pittance in comparison. Please seek professional help for at least the first year.
