Spent $20,000 on a new website for an online business

2020-04-16T09:32:07.851856+00:00
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start up cost deduction startup cost tax

We started an online business this year and set up a website which cost around $20,000 including design and development and everything needed to get us up and running. My question is, can we deduct this investment as a start up cost?

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finance, law, accounts 2020-04-16T10:02:13.140048+00:00
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For sure as it is part of your start up costs. Even if it is not, you can still deduct it as current expenses. Startup costs are subject to expenses amortization.

Check this link out for further details on this;

https://www.irs.gov/pub/irs-pdf/p535.pdf

The following excerpt from the IRS website may shed further light on this issue.

“The IRS allows you to deduct $5,000 in business startup costs and $5,000 in organizational costs, but only if your total startup costs are $50,000 or less. If your startup costs for either area exceed $50,000, the amount of your allowable deduction will be reduced by that dollar amount.”

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