Jasmine started a new business in the current year. She incurred $22,000 of start-up costs. How much of the start-up costs can be immediately deducted (excluding amounts amortized over 180 months) for the year?
A) $0
B) $2,500
C) $5,000
D) $22,000
E) None of the choices are correct.

Question

Quizplus · Accepted Answer

According to IRS guidelines, businesses can immediately deduct up to $5,000 of start-up costs in the first year. Jasmine incurred $22,000 of start-up costs, but only $5,000 can be immediately deducted, leaving $17,000 to be amortized over 180 months. Therefore, the correct answer is choice C, $5,000.

Jasmine Started a New Business in the Current Year