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#2
01-31-2005, 10:52 PM
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 Re: is interest deductable? Paul A Thomas wrote: - quote - > <johnmolinda[at]yahoo.com> wrote
I am going to disagree with this. As these were START-UP> > Second question... I have a $50,000 4.9%APR line of credit > > from MBNA Bank. I am using this line of credit, probably > > $20k worth, to fund the start up operating costs of my new > > business. Will the interest be tax deducatble? > Yes. The tracing rules should apply, and if the borrowed > money was used for business purposes, then it would be > deductible. costs, the interest isn't deductible - but must be amortized as part of the start-up costs under IRC 195. You do get it eventually, but over 60 months (5 or 6 years), not 1 year all at once. Interest incurred AFTER THE OPENING of the business will qualify for the current-year deduction. << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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#1
01-30-2005, 11:40 PM
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| Re: is interest deductable? As a general matter, yes. Check with your cpa. << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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01-30-2005, 10:23 PM
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| Re: is interest deductable? <johnmolinda[at]yahoo.com> wrote - quote - > Second question... I have a $50,000 4.9%APR line of credit
Yes. The tracing rules should apply, and if the borrowed> from MBNA Bank. I am using this line of credit, probably > $20k worth, to fund the start up operating costs of my new > business. Will the interest be tax deducatble? money was used for business purposes, then it would be deductible. It would be better though, to have the loan, line-of-credit, etc in the business name. -- Paul A. Thomas, CPA Athens, Georgia taxman at negia.net << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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#-1
01-27-2005, 04:17 PM
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| is interest deductable? Second question... I have a $50,000 4.9%APR line of credit from MBNA Bank. I am using this line of credit, probably $20k worth, to fund the start up operating costs of my new business. Will the interest be tax deducatble? << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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| deductable, interest |
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