My family just started a small restaurant business. Beside the major investment on equipments, we spent some money on traveling, mailing, lawyer fees etc before the startup. I just wonder how to treat these expenses:
- make them to the operating cost in the first month? or
- add them to the investment, and take amortization?
Thanks,
John
you are allowed a $5,000 startup expense deduction the first year and the remainder amortized, however I would suggest contacting an accountant in the first year because you can create quite a bookkeeping and tax mess if you do not start out correctly. many small business owners just starting out do not discover this until it takes time and expense to unravel the mess.
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