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Haven't been able to find an answer to this question. If an LLC is formed in October 2020 when I file taxes in April 2021 for the year 2020 can I claim the entire year expenses for the business in 2020 with the receipts I have or can I just use the expenses/receipts from October 2020 to Dec 2020?

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  • This may be a grey area. For example you can deduct any money spent getting the company up and running (like State filings) even before the company is officially an LLC, however if you are just piling in deductions that can be seen as a business expense and aren't really related to that business, that may get you in trouble with the State/IRS. – Ron Beyer Mar 26 at 1:30
  • No wanted to file for related company expenses like design, app and site dev. sq ft of area and MacBook that were purchased/done before the LLC. Have all receipts of items and wouldn't file without proof but didn't know since I did a lot of it in my free time with the expectation of launching in late 2020 – Gʀɪᴍ Mar 26 at 2:51
  • You want to clarify the year in which you're talking about filing your taxes. – bdb484 Mar 26 at 4:01
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You will not find a place to enter the date of LLC filing on Schedule C (or appropriate business tax form). What you will find are fields to enter valid business expenses for the year. Whether or not the business entity is an LLC or not is immaterial. If expenses are valid for the business in the tax year they will be allowed.

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If you are the sole owner of the LLC and it does not elect to be taxed as a corporation, the LLC is a "disregarded entity" for income tax purposes, and all of your receipts and expenses for the business are reported on Schedule C.

If the business was a general partnership with multiple owners, and an LLC is formed with the same owners, you could file form 1065 partially for the pre- and post-LLC operations, but if you filed a single form 1065 with the entire year's results and the allocation of profits and losses were the same, it would not change the tax liability of any of the general partners.

If the business was anything other than a corporation prior to forming an LLC and the LLC elected to be treated as a corporation (most often as an S-corporation) upon formation, then you would need one set of tax returns up until its formation and a Form 1120 for the remainder of the year.

Likewise, if the business was a sole proprietorship prior to the LLC and had multiple owners after formation two returns would be needed.

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