Tax Law (Questions About Taxes)/Mutual Fund Startup

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Question
Hello Randall,

I'm one of the experts in the Music/Oldies category and don't normally get to ask the questions, but here goes:

In December, I started an investment in a mutual fund and the startup cost (broker's fees) is $1,150. Can I deduct that as a capital gains (loss)? I do not itemize; I take the Standard Deduction.

Thanks very much for the help!

Dave

Answer
Well, first, that sounds like an extraordinary amount of "start-up cost" for an investment account. There should not be ANY investment cost with investing in a mutual fund.

It is not a capital gain or loss. I would like to know more about this fee before I comment further.

Exactly what type of investment was this? Was this a management fee? Consulting fee? Very odd for this type of investment. Also, can you tell me approximately how much you invested?  

Tax Law (Questions About Taxes)

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Randall Klein, MBA, EA

Expertise

I am an expert in personal and small business taxation, including Forms 1040, 1120, 1120S, 1065. I can answer any type of tax question except those that are requesting help in illegal tax evasion. Tax avoidance is legal, however. I do not do offshore trusts, or opt-out of the tax system type of queries.

Experience

25 years real experience in dealing with tax preparation, representation before the IRS, tax problem resolution, and more. Successfully represented clients in Offers in Compromise with more than 95% of all offers accepted.

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National Association of Enrolled Agents National Society of Tax Preparers BNI - Business Networking International

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Yahoo Answers - recognized as a tax expert.

Education/Credentials
MBA, Weatherhead School, Case Western Reserve University. BA, Indiana University, Bloomington Enrolled Agent, licensed by US Treasury.

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Most of my clients are small business owners

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