are my business expenditures deductible?
January 23, 2007 2:01 PM Subscribe
How can I tell whether or not the expenses incurred by my new LLC, which I'm filing taxes for as a partnership and which is operating at a loss this year, can be claimed by the members as deductible business expenses?
posted by lgyre to Work & Money (7 answers total) 1 user marked this as a favorite
So supposedly filing as a partnership is the usual thing for an LLC, which is fine with me, except that there seems to be one way in which you have to differentiate-- since the members liability is limitted, not all losses of the company can be distributed among and claimed by the members as deductible business expenses.
My business is new this year. It had a lot of startup costs including purchasing a building (which I will depreciate if possible), improvements to the building, and legal fees, and actually hasn't even opened yet so has not made any income. The money for these costs was put in by the members, so the company is not in debt, but is definitely operating at a loss. I am really hoping to be able to apply my share of this loss as a business expense on my personal taxes, because I spent money on my business assuming I would be able to deduct it. How can I tell whether I can deduct this, or which expenses are elligible?
(All the information I could find on the IRS website was that only a professional could answer this question, but I think I understand everything else about my filing process so I am reluctant to go that way.)