Can I deduct the costs I spent before my business even opened?

Yes — startup and organizational costs are deductible, but with a special rule. You can deduct up to $5,000 of startup costs and up to $5,000 of organizational costs in your first year of business, with any excess amortized (spread out and deducted) over 15 years. The $5,000 immediate deduction phases out if total startup costs exceed $50,000. Eligible startup costs include market research, advertising before opening, training, and travel to find suppliers or customers; organizational costs cover things like LLC filing fees and legal work to set up the entity. The catch: these deductions only become available once the business is actually "active" and producing — costs for a venture you never launch generally aren't deductible. Keep dated receipts from the planning phase, since people routinely forget to claim these.