Powell Incorporated was incorporated and began operations on October 1 and adopted a calendar year for tax purposes. Powell paid $4,200 to the attorney who handled the corporate formation. Which of the following statements is true?

• If Powell capitalized the $4,200 payment for financial statement purposes, it must also capitalize it for tax purposes.

• Powell can deduct the $4,200 payment on its first tax return.

• For tax purposes, Powell must capitalize the $4,200 organizational cost and amortize it over 15 years.

• None of these choices are true.