Startup Costs Amortization Calculator
Calculate Section 195 startup and organizational costs deductions.
Immediate Deduction (Year 1)
Startup:$ 5000
Organizational:$ 5000
Total:$ 10000
Maximum $5,000 each. Phase-out begins at $50,000. Zero at $55,000+.
Amortization
To Amortize:$ 50000
Monthly:$ 278
Annual:$ 3333
Period:15 years (180 months)
Start Month:Month 7
Deduction Schedule
| Year | Startup Ded | Org Ded | Amort Ded | Total Ded | Remaining |
|---|---|---|---|---|---|
| 2024 | $ 5000 | $ 5000 | $ 1667 | $ 11667 | $ 48333 |
| 2025 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 45000 |
| 2026 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 41667 |
| 2027 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 38333 |
| 2028 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 35000 |
| 2029 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 31667 |
| 2030 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 28333 |
| 2031 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 25000 |
| 2032 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 21667 |
| 2033 | $ 0 | $ 0 | $ 3333 | $ 3333 | $ 18333 |
Tax Benefit
Year 1:$ 2800
Total:$ 14400
Rate:24%
Recommendation
Deduct $10000 immediately. Amortize $50000 over 15 years. Year 1 benefit: $2800.
Eligible Startup Costs
- Market research
- Advertising for opening
- Employee training before opening
- Salaries before opening
- Travel for securing suppliers/distributors
- Professional fees (legal, accounting)
- Licenses and permits
Ineligible Costs
- Research and experimental costs
- Cost of assets with useful life
- Organizational costs (separate election)
- Operating costs after business starts
Startup Costs Key Points
- Section 195: startup costs
- Section 248: organizational costs
- $5,000 immediate each
- Phase-out at $50,000
- Zero deduction at $55,000+
- 15-year amortization
- Start month business opens
- Must elect on first return
- Attach statement to return
- Form 4562 for reporting