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Home based business partnership tax question..?

PostPosted: Thu Oct 28, 2010 12:16 pm
by joss
My partner and I have started a small side business operating out of my shop at my house.
Both of us are currently employed through other companies also. Now I understand we file a form 1065 which allows the business' taxes to "flow through" to our personal taxes. I also understand you can write off 5000 of start up capital the first year. Does this mean that 2500 comes off of personal taxes we each owe resulting in 2500 extra on our tax refund? Even if the business may only generate couple hundred dollars by the end of the year if any at all....