Hi, @RobertG – thank you for the quick response! Let me ask a follow-up to make sure that I understand what you're saying, and also to clarify something else:
Let's say that I bought $3500 worth of materials plus $3000 worth of tools and machinery to make my product, and that I sold $250 worth of product. Let's say that I did all of this in 2019. In that case, I can only claim $250 of COGS (cost of goods sold) on my 2019 taxes. Is that correct?
Second, the $3000 worth of tools and machinery are never going to be "consumed" or "sold," so I'm guessing I shouldn't count it as COGS. What should that be categorized under then?
Thank you so much for your help!
