Paid accountant to register business with state & get State Sales & Use Tax License. Costs were included in his $350 fee. Is this Accounting or Start-Up expense?

Costs to register your business with the state and establish a State Sales & Use Tax account are "start-up" or "organizational" costs; you incur these costs before you open the door and, subject to some limitations, you can expense them in your first year of business.

Start up costs are those expenses incurred in planning and setting up the business, costs you incur before you open the door.

A portion of startup and organizational costs can be expensed (written off in your first year). The remainder can be amortized (written off over a period of 15 or more years). Here is how it works:

• For expenses paid or incurred after October 22, 2004, you can deduct up to $5,000 in startup and $5,000 organizational costs as current expenses - if the costs are under $50,000, respectively or;
• You can choose to amortize startup and organizational costs greater than $5,000, respectively, (but less than $50,000, respectively) over a period of 15 years.
• If your startup or your organizational costs are more than $50,000, respectively, the excess amount reduces the amount you can deduct.

For additional information, see Start up costs for business