Do we file all our startup costs - travel, cost of buying inventory, website - as start up expenses since we didn't actually sell product until late Dec?
Start up costs would include all expenses that incurred during the process of creating your new business. Your inventory purchases make up part of your cost of goods sold in that section of your return. Website development and travel costs would be startup expenses.
How these expenses are handled:
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.
If total startup costs exceed $50,000, the excess over
$50,000 reduces the amount you may deduct. For example: If you incur $52,000
worth of startup costs, you can deduct $3,000 ($5,000 - ($52,000 - $50,000 =
$2,000)) and amortize the remaining $49,000 over at least 15 years