How to advance money to a start up for tax purposes?
I am about to advance some money to a startup company (a Massachusetts LLC) to cover their startup costs. What do I need to do to make this money deductable on my personal income tax, particularly if that company ends up failing? How do I formally “give” this money to them and how do I write them off on my own 1040?
Tags: advance, company, LLC, Massachusetts, money, personal income tax, purposes, Start, startup, startup company, startup costs
Related Items
- I transferred startup money to my new company, how do I account for this to the IRS?
I was running my business as a sole-proprietership for a few years then I set it up as an LLC. I transferred money to my LLC so it had money to work ... - How can I start a small Credit Card Company?
I am curious to know how much start up money would be needed to start a small Credit Card Company. I am interested in extending credit with Secured Cr... - What kind of internet business or home business i can start to earn more money?
I want to start a internet business or home business to earn more money. Please suggest a honest company. If you have any other suggestion for busines... - How do I start a security gard company in the Dallas/Fort Worth area. To meet all local and state laws.?
I dont know anything bout the laws and compliences regarding stating my own security guard company in the metroplex. Can someone please help. Never us... - how can an Indian company start a business in Australia? How do I register it economically?
Should the company be registered as an australian company or an Indian one? The Indian company has an experience and good reputation of 8 yrs in India... - how can an Indian company start a business in Australia? How do I register it economically?
Should the company be registered as an australian company or an Indian one? The Indian company has an experience and good reputation of 8 yrs in India... - How much money do I need to start a moving business? Also what type of license do I need?
I plan to own a moving business throughout the state of Maryland and surrounding states. PLease help me ... - Temp agencies. How does it save a company money when they hire people through a temp agency?
Wouldn't it cost less money for the company to have Human Resources Dept, interview and hire for themselves? ... - Is Facebook really going to start charging money?
Ok, I've seen several new groups and/or pages talking about Facebook charging money to use it next month. Is this true? Why are they doing this? Why h... - What is the maximum amount of money that can be withdrawn a bank w/out prior notice?
I want to pull $3,500 out of the bank to buy a bike but, I want to make sure that I don't have to ask them in advance due to not getting off work unti... - I want to learn to play guitar, how should i start?
what's the fastest way to learn how to play acoustic guitar? Give me some links with instructions or chords plz if u can thanks in advance ... - how do i get a grant for business and restaurant where do i start first do i get a loan from the bank?
i need help to starting a restaurant business i dont have no money for nothing i dont no how to get a business grant some body tell me shounld i get a... - What can we the consumer do to start getting the money flowing again to put a stop to the economic downturn?
I am worried about our future everyone seems to have lost confidence in the banks and have now stopped spending money. I am interested to know what ... - Where do I start to make money via internet?
I want to make money with my computer. Is there any trusted person out there to help for advice on getting started. ... - How should I go about retrieving money owed to me by a company?
Back in March a leading insurance company took an unauthorised payment of £20.06 from my account. They said they would issue a refund in the form of a...
July 27th, 2010 at 2:34 pm
Start up costs are not deductible. They must be amortized.
July 27th, 2010 at 3:32 pm
If you have not already secured your cash advance, you may want to look into government grants…basically free money that you do not have to pay back.
July 27th, 2010 at 3:56 pm
Investing in a company (debt or equity) is not deductible. It is an asset that you hold similarly to buying stock or bonds in a publicly traded company.
IF the business venture fails, and you have exhausted all of your collection efforts, you can write off the loss of principal in the investment as a Capital Loss subject to normal capital loss limitations.
Get something in writing such as a promissory note.
July 27th, 2010 at 4:19 pm
It isn’t deductible. Depending on how the advance of the money is structured, if they fail you might be able to take a deduction for the amount of your loss. That won’t give you the whole amount back, only a small % of it on your taxes.