Single Member LLC start up tax deductions.?

Question

In the same tax year, prior to LLC formation, any business expenses such as tools, and training I want to deduct on my taxes. But if I use my personal credit card for those items and the formation of the LLC is that an issue of co-mingleing funds for an LLC? Since I can not have a business checking account prior to the LLC formation.

Judy · Answer

A single member LLC is disregarded anyway for taxes, so works like if you didn't have an LLC.  Startup expenses are amortized over several years.  Where the funds came from, business or personal account, doesn't matter.

tro · Answer

if you are operating this LLC as a sole proprietor, you don't pay yourself any wages, this would be reported on Sch C and SE and you pay your own self employment taxes
if you are operating as a Corporation, the Corporation would be your employer and the Corporation would match the FICA taxes withheld from your pay
start up expenses are treated the same for any business, if you paid for them with your personal money this would be your capital contribution toward the Corporation
as a sole proprietor, you would amortize them when your business is actually operating

Bobbie · Answer

Seek and find a good experienced EA Enrolled agent for some face to face advice an guidance with your tax matters for this purpose and time to try and prevent some bigger problems at some future time.
Hope that you find the above enclosed information useful. 01/01/2015

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Single Member LLC start up tax deductions.?

3 Answers