Question

We have been putting a business together in 2020. We did not have any operations in 2020 but have expenses. Is it ok to have $0 income and write off expenses?

Forum|Forum|5 years ago
March 9, 2021
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TurboTax Self Employed Online

Employee

If the business is not operating yet, you hold all your startup expenses until the business is in operation.

Then, assets are listed and depreciated according to the usual rules. Other startup costs can be deducted in the first year of operations (if they are $5000 or less) or amortized over 15 years (if they are more than $50,000) or a combination of expensed and amortized (if they are in between $5000 and $50,000).