Startup costs are reasonable business expenses incurred before a company is officially in business. These costs may include office space, furniture, market research, consulting fees, equipment, and similar business-related purchases. If you’re thinking about starting a new business, adopt an expense-tracking system now, and use it to record and manage all of the company’s receipts, before and after the first day of business.
Consider a mobile app, such as Xpenditure or IQBoxy Expenses, to digitize receipts and simplify tracking. For tax purposes, business purchases made before your company’s start date qualify as startup costs, and those made after that date are usually written off as business expenses.