In this episode of Dr. Friday’s Tax Tips, the focus is on claiming tax deductions for small business startup expenses. Dr. Friday explains that these expenses don’t necessarily have to be incurred in the same year the business starts operating. Entrepreneurs who have been working on their business for a year or two prior to the official launch can still claim related expenses, such as educational materials and books, as tax deductions. However, it’s important to distinguish between legitimate business expenses and hobby-related costs, as the latter are not tax-deductible. Dr. Friday emphasizes the importance of not leaving any eligible tax deductions unclaimed.
Transcript
G’day, I’m Dr. Friday, president of Dr. Friday’s Tax and Financial Firm. To get more info, go to www.drfriday.com. This is a one minute moment.
Did you know that credit for a small business startup doesn’t mean you had to spend all the money in the year you’re talking about. So if you started a business but maybe you started thinking about the business two years ago and maybe you went ahead and set up some different education, you brought books, you did things, that’s all considered startup. So when you’re actually starting a business you want to be thinking about now if it’s a hobby or it’s a business that never happened and never go off the ground that’s not a tax deduction guys. Just because you made the mistake for the wrong that’s one thing but if you’ve been working a year or two to open a business that can be a tax deduction. Don’t leave any tax deductions on the table.
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