MACR
offlineMember
I wanted to double check that you are allowed to expense 5,000 for each of those.
So: you could expense 5,000 for Organizational expenses AND another 5,000 for Start up costs and then amortize the remainder (provided it's less than $50,000) over 15 years.
I am just unsure reading what the Becker book has, as I have not seen a problem with both in it but not so sure..
Thanks & goodluck to all!
WICPAHOPEFUL
offlineMember
A taxpayer can deduct up to $5,000 of start-up and $5,000 of organizational expenditures in the tax year in which the trade or business begins. Each $5,000, however, is reduced (but not below zero) by the amount by which the cumulative cost of start-up or organizational expenditures exceeds $50,000. Start-up and organizational expenditures not deductible in the year in which the trade or business begins are amortized over a 15-year period consistent with the amortization period for Sec. 197 intangibles.
A separate election statement is no longer required to elect to deduct up to $5,000 of business start-up and organizational costs paid or incurred after September 8, 2008.
MACR
offlineMember
WI- thanks for the response!
So does that mean that each category of costs is allowed $50,000 before it begins reducing the amount dollar for dollar.
Ex:
Startup Costs- 51,000. $4,000 Expensed (5,000 - (51,000- 50,000)) 47,000 Amortized.
Organ. Exp- 15,000- 5,000 expensed, 10,000 amortized.
Or is the amount cumulative?
Thanks again!
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