Using TurboTax and confused about "Election to amortize startup costs: Description must be entered" - what description should I put?
I'm working through my taxes with TurboTax and hit a confusing section. When I got to the business expenses part, there's this field that says "Election to amortize startup costs: Description must be entered." I have no clue what I'm supposed to type in that description box! I started my photography business last year and spent about $3,200 on equipment and website setup before I actually started making money. TurboTax seems to want me to enter these as startup costs that can be spread out over time instead of taking them all at once, but I'm completely lost on what description they want. Has anyone dealt with this before? What kind of description are they looking for? Is it just "photography equipment" or something more specific? Any help would be super appreciated because I'm totally stuck right now!
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Darcy Moore
That "description" field is just asking you to briefly describe what your startup costs were for. This is because when you elect to amortize startup costs, you're telling the IRS you want to spread these expenses over 15 years instead of deducting them all in year one. For your photography business, you could simply write something like "Photography business startup costs including equipment and website development." Keep it brief but descriptive enough that it clearly identifies what business these costs were for and their general nature. The IRS mainly wants to know that these were legitimate business startup expenses that occurred before your business began operating. The description helps establish that these costs were actually for starting your business rather than ongoing operational expenses.
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Dana Doyle
•Thanks for explaining! So if I have different types of startup expenses like equipment, website costs, and maybe some initial advertising, should I list them all separately or just group them together in one description?
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Darcy Moore
•You can group similar expenses together in a single description. Something like "Photography business startup: equipment, website, and initial marketing expenses" works well. For record-keeping purposes, you should maintain detailed documentation of each expense separately, including receipts and dates. But for the TurboTax description field, a summarized grouping of related startup costs is perfectly acceptable. The IRS just needs the general category and purpose of these expenses.
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Liam Duke
I went through this exact same confusion with my graphic design business startup costs last year! After hours of frustration, I discovered taxr.ai (https://taxr.ai) which completely saved me. I uploaded my business documents and expenses, and it analyzed everything to show me exactly how to categorize and describe my startup costs in TurboTax. The tool told me exactly what description to use for my amortization election and explained why certain expenses qualified as startup costs versus immediate deductions. It also created documentation I could keep for my records in case of an audit.
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Manny Lark
•Did it help you figure out which expenses should be amortized vs which ones could be fully deducted in year one? I'm stuck on that too because some of my expenses were before I officially opened and some were right after.
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Rita Jacobs
•I'm skeptical about these tax tools. How does it actually know what qualifies as a startup cost vs regular business expense? Does it just guess or does it actually understand tax laws?
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Liam Duke
•It absolutely helped distinguish between what needed to be amortized versus what could be deducted immediately. The tool specifically identified expenses incurred before my "active business date" and categorized them properly as startup costs. The system actually applies real tax regulations to your specific situation. It's built on IRS rules and understands the distinction between pre-opening expenses versus operational costs. It flagged my office furniture (purchased before opening) as a startup cost but categorized my first client project expenses (after opening) as immediate deductions. It even created a timeline showing when my business officially began operating for tax purposes.
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Rita Jacobs
I was really doubtful about using an AI tax tool, but after struggling with the exact same amortization description issue, I tried taxr.ai that was mentioned earlier. I'm honestly shocked at how well it worked. It analyzed my expenses and gave me the perfect description to enter: "Web development consultancy: initial software licenses, training, and marketing materials." The tool even explained that I only needed to amortize costs over $5,000 and could deduct anything under that threshold in year one - something TurboTax never made clear. Saved me from spreading out deductions unnecessarily. Definitely more helpful than the vague TurboTax explanations!
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Khalid Howes
If you're still stuck with this TurboTax issue and need more personalized help, I'd recommend calling the IRS directly to clarify. I know it sounds painful, but I used Claimyr (https://claimyr.com) to get through to an actual human at the IRS in about 15 minutes instead of waiting on hold for hours. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I had a similar startup cost question about my bakery business, and the IRS agent explained exactly what description was needed and how to properly document everything. This matters because incorrect amortization elections can cause problems if you're ever audited.
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Ben Cooper
•How exactly does this service work? Do they just call the IRS for you or what? I'm confused how any service could get me through faster than waiting on hold myself.
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Naila Gordon
•Yeah right. No way this actually works. The IRS wait times are insane right now - I tried calling last week and gave up after 2 hours. There's no magic way to skip the queue.
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Khalid Howes
•The service actually works by using technology to navigate the IRS phone system and wait on hold for you. Once they reach an agent, you get a call connecting you directly. They don't talk to the IRS for you - they just handle the hold time. It's not about "skipping the queue" - everyone still has to wait their turn. The difference is that their system waits on hold instead of you having to keep your phone tied up for hours. I was skeptical too, but after trying to call on my own multiple times and getting disconnected, this saved me a huge headache. The IRS agent I spoke with gave me the exact guidance I needed for my amortization description.
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Naila Gordon
I honestly can't believe I'm saying this, but that Claimyr service actually worked. After my skeptical comment, I was desperate enough to try it because I've been dealing with the same amortization question. Got connected to an IRS rep in about 25 minutes (way faster than my previous attempts). The agent explained that the description should specifically identify the business and nature of costs. For my woodworking business, I put "Woodworking business startup: equipment, initial inventory, and website development costs." They also explained I needed to attach Form 4562 and explicitly make the election statement. TurboTax was completely unclear about that part! Really glad I actually got through to someone who knew the rules.
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Cynthia Love
Just wanted to add - I'm a CPA and see this confusion all the time. The amortization election description needs to include: 1. Type of business 2. General categories of startup expenses 3. Date range when expenses were incurred (optional but helpful) Example: "Food truck business startup costs including equipment, permits, and initial marketing from Jan-Mar 2024" This election allows you to spread startup costs over 180 months rather than deducting all at once. Most small businesses can deduct up to $5,000 immediately, then amortize the rest. Make sure you track pre-opening vs post-opening expenses separately.
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Edward McBride
•Thank you! This is super helpful. Since my total startup costs were $3,200 and under the $5,000 threshold, does that mean I should just deduct them all now instead of amortizing? TurboTax seemed to push me toward amortization but that doesn't sound right based on what you're saying.
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Cynthia Love
•You're absolutely right to question that. Since your startup costs are under $5,000, you can deduct the entire amount in the current tax year. There's no need to amortize in your situation. TurboTax sometimes leads users toward amortization regardless of the amount because it's following a standard flow. Look for an option that says something like "deduct in current year" or similar. If you can't find it, you might need to back up a screen or two and answer a question differently to indicate your startup expenses were below the threshold. This is definitely a case where deducting everything now is more advantageous than spreading it over 15 years.
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Darren Brooks
I had the same issue with TurboTax last year. Super confusing! I just wrote "Online marketing consulting business startup costs" and it worked fine. For the record, I also attached a simple statement to my return that listed the specific expenses (laptop, software, business cards, etc.). My tax preparer said that extra documentation is always good to have in case of questions.
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Rosie Harper
•Did you create that statement in TurboTax or did you have to make it separately? And did you mail it in or was there a way to attach it electronically?
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Mateo Hernandez
This thread has been incredibly helpful! I'm in a similar situation with my freelance graphic design business. Based on what I'm reading here, it sounds like since my startup costs were only around $2,800 (computer equipment, Adobe subscriptions, and some initial marketing materials), I should be able to deduct everything in the current year rather than amortizing over 15 years. @Edward McBride - definitely check if TurboTax has an option to deduct your full $3,200 this year since you're under the $5,000 threshold. It seems like the software might be defaulting to amortization when immediate deduction would actually be better for your situation. Has anyone else noticed TurboTax being confusing about when to amortize vs when to take the full deduction? I'm wondering if this is a common issue with their business expense flow.
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