Can I take advantage of any of the associated expenses (as a 1099) in 2016 even though I was not a "Legal Entity" until 12/30/2016?

[selias829]

In October of 2016, I started to transition from a W-2 to a 1099.  The revenue from the 1099 position did not begin to come in until 2017 but I did have expenses directly related to the 1099 position. 

Steve

[Coleen3 · Accepted solution]

Yes, it is possible to take expenses. 

• You can enter your startup cost under the Business tab.
• In the Business Income and Expenses section click "I'll choose what I work on."
• Next, click update under the Business Income and Expenses field and click edit next to the business you need to update.
• In the Business Expense field, click the Start button next to Startup Cost and follow the prompts to enter your startup expenses

Startup costs come from investigating the creation or acquisition of an active trade or business. They are paid or incurred before the business opens its door.

Examples include:

 - Market research

 - Travel costs

 - Salaries

 - Consulting fees

 - Accounting and legal fees

 - Pre-opening advertising expenses, and

 - Overhead

 Up to $5,000 of startup costs paid or incurred can be deducted if the total startup costs incurred don't exceed $50,000. An election can be made to amortize costs in excess of $5,000 over a period of 15 years.