Forums: Discussions for entrepreneurs and small business.

Hi all -

I`m new to the site and looking forward to getting to know y`all.  I have a burning question that I just can`t find an answer to... not online, not on the phone with H&R Block, and not on the phone with the IRS - !

(Or, maybe just not the answer I want. )

I`m a web developer building a site for an online-only business I will launch early next year.  I`m putting in a ton of time into this, unbilled of course (not getting money yet so can`t pay myself).  Is there any way I can deduct this time at a reasonable rate from my personal tax burden for 2006?

I quit my job and have worked already about a month.  Is this in some way deductible, in part or in whole, perhaps viewing this as a time investment, or pro bono work, or even "opportunity cost" (since I`m not getting paid for doing something for someone else)??

Thanks!  Any leads greatly appreciated. 

(What the IRS did say was that on Schedule C, the one about being a sole proprietorship, it`s very difficult to deduct my own time, but I`m not sure she fully understood my situation...)

Life`s not fair ....... time is not tax deductible. The good news is that if you should have any to spare, its not taxable income .... at least not yet.

Scott Reynolds (CPA)

 

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R Scott Reynolds, CPA
www.b2bcfo.com

If it were a corporation, in theory you could deduct it from the corporations income, and then pay yourself against a loan or something from the corporation.  But that would make a net zero transaction, and you would have to pay taxes for the income from the corporation. 




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Smart Capitalist | Coffee Shop Funding | Tyler Weaver Personal Blog

True enough. Likewise, pro bono work is not deductable, either. However, any costs you incur—office supplies, equipment, anything you put into the business to get it off the ground—is.

Find yourself a good accountant—I really think that should be among the very first steps for any startup.


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