Startup costs are deducted as of the first year your business is active and ongoing with a profit motive, and you file a schedule C or other tax return. Active and ongoing does not have to mean you make a profit, but it means you are engaging in business activities with the intention of making a profit (like advertising for clients, starting jobs, but maybe haven't been paid yet). If you have not actively been engaged in business activities, then you don't file a tax return, and you save your startup costs for when you are engaged in business. If you did actively engage in business activities in 2024, you can file a 2024 business tax return (depending on how you organized the business) and include your startup costs.
Assets are handled in the usual way (depreciation, including special forms of depreciation if you are eligible). Other startup expenses may be expensed in the first year if less than $5000. If over $5000, then some can be expensed and some must be amortized over 15 years according to a formula that I don't know but Turbotax does.
If you deduct startup costs and show a loss, you may be able to deduct that against your other income, or you will carry the loss forward so it will negate some part of your future taxable profits.
Startup costs are deducted as of the first year your business is active and ongoing with a profit motive, and you file a schedule C or other tax return. Active and ongoing does not have to mean you make a profit, but it means you are engaging in business activities with the intention of making a profit (like advertising for clients, starting jobs, but maybe haven't been paid yet). If you have not actively been engaged in business activities, then you don't file a tax return, and you save your startup costs for when you are engaged in business. If you did actively engage in business activities in 2024, you can file a 2024 business tax return (depending on how you organized the business) and include your startup costs.
Assets are handled in the usual way (depreciation, including special forms of depreciation if you are eligible). Other startup expenses may be expensed in the first year if less than $5000. If over $5000, then some can be expensed and some must be amortized over 15 years according to a formula that I don't know but Turbotax does.
If you deduct startup costs and show a loss, you may be able to deduct that against your other income, or you will carry the loss forward so it will negate some part of your future taxable profits.
IRS info on start up costs:
https://www.irs.gov/newsroom/heres-how-businesses-can-deduct-startup-costs-from-their-federal-taxes