| Share

What is the start date for my business?

by Jeff Heimler, CPA

When does my business officially start if I form a corporation?

Your business officially starts when the business begins operations. For a service or consulting company, that means providing services. For a retail store, that means when the doors open. You do not have to generate income or sales on the first day of operations, but you must be operating the business so that you can generate income. It is important you determine when the business starts because you treat all costs you incur prior to that time as start-up costs or organization costs. You must amortize these costs over five years starting when the business begins operations. Some examples of start-up costs include surveys of potential markets, advertising the opening of the business, and professional fees paid in connection with starting the business. Once you begin normal operations, you can deduct normal operating expenses as they occur.

Jeff Heimler, CPA, owns Heimler & Associates, CPA. You can reach him at (949) 252-8192(949) 252-8192.

Have a question for a CPA? Ask it here.

In accordance with IRS Circular 230, the information on this website is not intended or written to be used, and cannot be used as or considered a "covered opinion" or other written tax advice and should not be relied upon for the purpose of avoiding tax-related penalties under the Internal Revenue Code; promoting, marketing, or recommending to another party any transaction or tax-related matter(s) addressed herein; for IRS audit, tax dispute or other purposes.