As a home-based travel agent, can I deduct the membership cost (Approx $6k) in addition to the annual membership renewal fee ($149)?

[ee-ea]

6K for what?

[amontano916]

I paid $6000 for a travel agency "membership" which I was told is comparable to a franchise fee as a franchisee. With this membership, I gain access to travel agent portal and my host agency's IATA #. The $149 is the annual "dues" that I'm required to pay annually to keep my membership active. I wasnt sure if I am eligible to deduct the $6k, and if so, how? As an asset? Thanks for your help.

[BMcCalpin · Accepted solution]

You are permitted to deduct up to $5k in startup costs (which is what the membership cost appears to be). Report $5k of the membership fee as an Miscellaneous Expense as "membership fee". Then you have to amortize the rest of the start-up cost ($1k plus any other start-up costs you had) over a 15 year period (yes, like an asset).

The $149 expense sounds like an operating cost and should be deducted yearly, again, you can put it under Miscellaneous Expenses.