This may be a silly question, but just so I'm clear, I'm assuming that you can't write off anything from the firm until it is actually generating revenues. Is that right?
In the case of a corporation (C-Corporation or S-Corporation) business expenses are paid by the corporation and most are tax deductible on the corporation's tax return. So if a corporation has revenue no taxes are paid on the money used towards deductible business expenses. This is one of the nicest features of corporations because there are so many deductible business expenses.
Comments
This may be a silly question, but just so I'm clear, I'm assuming that you can't write off anything from the firm until it is actually generating revenues. Is that right?
No. Business expenses can be deducted even with no revenue: milage, business supplies, equipment, lunch about business dealings, etc.
Interesting. Do you deduct those expenses from future revenues or from your personal income?
In the case of a corporation (C-Corporation or S-Corporation) business expenses are paid by the corporation and most are tax deductible on the corporation's tax return. So if a corporation has revenue no taxes are paid on the money used towards deductible business expenses. This is one of the nicest features of corporations because there are so many deductible business expenses.