Common Start-Up Expenses that occur prior to first date of being in business

  • Research on location of the business, market survey,  labor supply and transportation supply
  • Advertising to open the business
  • Employee training
  • Travel expenses to find the location and open the business
  • Expenses relating to financing,  suppliers, and distributors
  • Licenses,  permits and other fees
  • Fees paid to lawyers,  accountants, consultants, and other professional services
  • Operating and office supplies for the business
  • Utilities and utility deposits
  • Rent and lease-holders improvements

The following are NOT Start-Up Costs

  1. Inventory   [deduct inventory costs as you sell the inventory]
  2. Long-term assets  [depreciate the items that have a useful life more than one per IRS schedule]
  3. Research & Development [special category that must use IRS Section 174]
  4. Education expense [ costs you incur to qualify for a new business or profession]
Start-Up Costs