Comment by lowkey_

Everything you just said but imagine revenue is $500K, and you spent $500K on salaries for the team.

You can only expense $100K of the salary costs this year, so even though you're break-even, you pay taxes on $400K in income.

Or, even worse, imagine revenue is $250K, and you spent $500K on salaries for the team.

You can only expense $100K of the salary costs this year, you're already -$250K on the year, and now you're paying taxes on $400K in income. You're destroyed.

VC-backed startups aren't designed to get profitable quickly, and I don't see that as a problem for the American taxpayer, and nobody is saying the taxpayer is giving money or helping. A business losing money should not have to pay taxes on income, as if it's not losing money.