26 U.S.C. § 248 — Organizational expenditures

(a) Election to deduct: If a corporation chooses (following Treasury regulations) to use this rule for its organizational expenditures, then: (1) for the year it starts business, it can deduct the smaller of its total organizational expenditures or $5,000 — but that $5,000 cap shrinks (never below zero) by however much the expenditures go over $50,000; and (2) whatever's left of those expenditures gets deducted evenly over the 180 months starting with the month the business begins. (b) Organizational expenditures defined: "Organizational expenditures" means costs that are tied to creating the corporation, must be charged to capital account, and would be the kind of cost that could be spread out over the corporation's life if the corporation had a limited lifespan. (c) Time for and scope of election: The corporation must make this choice by the deadline for filing its tax return for that year (including extensions). Once chosen, the corporation must use that same deduction period when figuring its taxable income for that year and every year after.