Question

Filing Form 1065 with only interest income on business that has not yet opened

Forum|Forum|5 years ago
March 15, 2021
1 reply
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We have a partnership that we have delayed opening due to Covid-19. We opened a business checking account that has $100 interest income. Should the monthly maintenance fees be deducted against this, even though the business is not open yet? Do we report startup costs on this year's return since we are filing a Form 1065 or can we still report it on next year's return? Thanks.

Not A Product Question

J

JeffreyR77

Start-up costs are not ordinarily deducted until the business is 'open for business'.

If your business is still in a start-up mode but has reportable income for tax purposes it is appropriate to deduct the monthly maintenance fees that are associated with the activity that is generating the interest income.

It is appropriate to continue to accumulate other start-up costs until you are 'open for business'.