Business Start Up & Expenses

[EA_TAX]

A Client started a Tai Chi Teaching Business in 2018 as a Sole Proprietor. She has business start up costs from the prior 2 years that include certifications. I found the IRS code for start up costs for incorporated business but what is the regulatory source for addressing start up costs for sole proprietor?
My other concern is that In addition to the new business, the client continues to teach tai chi as a volunteer for the local office for the aging without reimbursement, which has significant mileage. My plan is to keep the expenses separate between the business and the volunteering, and include the volunteering mileage as part of the client's charitable contributions.

Thank you in advance for comments,
EA_TAX, NYS

[ATSMAN]

I follow the same rules. Up to $5000 first year deduction, balance amortized over 15 years. If she is volunteering the mileage and expenses associated with that activity goes on Sch A not Sch C.

[kathyc2]

You may need to ask her some questions regarding the volunteer classes before determining the mileage classification. If she actively promotes her business and receives paying clients as a result of the volunteer work, it might be justifiable as a business expense.

[EA_TAX]

Thank you very much. Your comments have been helpful. I ask additional questions of my client.

[Lion]

Classes and certifications to qualify for a new business are NOT start-up costs. The classes might qualify for Lifetime Learning. If she was already in the business of teaching Tai Chi, then classes to improve her skills would be a biz deduction.