What is the name of your state (only U.S. law)? Maryland
In the end of 2012 my wife decided to quit her job in the medical field and create a dog walking/pet sitting company. She began her research then, gave months of notice to her practice, and filed the LLC in our home state of Maryland January 2013 (took two months to approve - became active in Maryland this month, March).
We both booked a trip in which the primary purpose was to pay for a 4-day Dog Walking Academy catering to pet professionals. It is essentially a workshop which included basic behavior training, answers/discussions of issues encountered as a small business owner, basic business/legal issues, etc. It also included Pet CPR certification and "certification" by this company (certainly not accredited - there is no body to recognize any official "certification" for dog walking/pet sitting - we have simply achieved their standard of certification). The LLC is a partnership where I own a small percentage because I will be helping out (making the website, billing, taxes, overflow dog services, etc.) and therefore I have a bona fide reason and business interest to attend.
My question is: the trip was of course expensive; two round trip tickets across the country, accommodations, food, as well as the class itself ($650 pp) and we naturally assumed it would be a deduction. I am now reading various blogs and internet sources that when starting a new business, training is not deductible if it is required for a new business.
I am not sure how to treat this. The facts are, there are no standards or regulations regarding dog walking/pet-sitting federally or in our state of Maryland. I believe California is the only state starting to regulate and they are only in the beginning. So, this education/training is not required by any regulations or governing body, but we certainly have a bona fide business reason for attending since it directly will improve our business. But, as of the date of the expenses, the LLC was not formed or operational.
How would we treat these expenses? Can we deduct them on our 2013 return as start-up expenses? Would they go on our schedule C for 2012? Do we capitalize them? I cannot imagine that we would have to "eat" the cost of this trip since we would not have taken it if we were not starting this business!
Thanks!
-Greg
In the end of 2012 my wife decided to quit her job in the medical field and create a dog walking/pet sitting company. She began her research then, gave months of notice to her practice, and filed the LLC in our home state of Maryland January 2013 (took two months to approve - became active in Maryland this month, March).
We both booked a trip in which the primary purpose was to pay for a 4-day Dog Walking Academy catering to pet professionals. It is essentially a workshop which included basic behavior training, answers/discussions of issues encountered as a small business owner, basic business/legal issues, etc. It also included Pet CPR certification and "certification" by this company (certainly not accredited - there is no body to recognize any official "certification" for dog walking/pet sitting - we have simply achieved their standard of certification). The LLC is a partnership where I own a small percentage because I will be helping out (making the website, billing, taxes, overflow dog services, etc.) and therefore I have a bona fide reason and business interest to attend.
My question is: the trip was of course expensive; two round trip tickets across the country, accommodations, food, as well as the class itself ($650 pp) and we naturally assumed it would be a deduction. I am now reading various blogs and internet sources that when starting a new business, training is not deductible if it is required for a new business.
I am not sure how to treat this. The facts are, there are no standards or regulations regarding dog walking/pet-sitting federally or in our state of Maryland. I believe California is the only state starting to regulate and they are only in the beginning. So, this education/training is not required by any regulations or governing body, but we certainly have a bona fide business reason for attending since it directly will improve our business. But, as of the date of the expenses, the LLC was not formed or operational.
How would we treat these expenses? Can we deduct them on our 2013 return as start-up expenses? Would they go on our schedule C for 2012? Do we capitalize them? I cannot imagine that we would have to "eat" the cost of this trip since we would not have taken it if we were not starting this business!
Thanks!
-Greg