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I am filing Schedule C for Business started in 2019. I have a commercial loan used to purchase the Business. I see that the loan interest is a business expense reported on Schedule C line 16. How do I report the loan down payment and principal payments made in 2019 as a business expense on Schedule C?
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@ldbeng wrote:
How do I report the loan down payment and principal payments made in 2019 as a business expense on Schedule C?
The loan down payment and principals payments are not deductible business expenses that would be reported anywhere on Schedule C; only the interest on the loan is deductible.
However, you should track of the loan proceeds and liability outside of TurboTax. Essentially, that would be a bookkeeping entry.
Only the interest on the loan is a deductible business expense. That's it. If you used the borrowed money to purchase physical business assets, then those assets get depreciated over time. How much time depends on the classification of the asset(s) purchased.
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