No neutral light and bike will only start of clutch is engaged. I can start bike in any gear and in neutral as long as clutch lever is pulled in. Its a 2015 fat boy lo.

the clutch is dragging, its not completely dis engaging when the clutch is pulled in, try taking some slack out of the clutch cable by tightening the cable just near the clutch lever , this shold pull the clutch further in and help finding neutral

All the Japanese bikes I have owned won't start in gear unless you pull in the clutch lever. There is a small plunger switch fixed to the clutch lever stock (the part that does not move). This switch is connected to the ignition and starter circuits, so when the clutch lever is closed the starter won't turn. Check the bike starts OK when not in gear. If you try to start the bike in gear and it does not start with the clutch lever pulled then the switch is not working. Hope this helps.

The clutch master/lever has a safety switch that tells the bike if the clutch lever is in (no power to rear) or out (power to rear). After almost 30 years this switch may have failed, making the bike think that the clutch is engaged regardless of lever position. If you have a multimeter you can test the switch yourself. Since the bike starts properly in neutral (also a safety feature) then the clutch lever switch is your most likely problem. Your bike might also have a side stand switch like mine. It functions much the same way, if the side stand is down and the bike put in gear it will kill the engine.

MGM

Instructions

1. • 1 The gears on a motorcycle run in this order: first, neutral, second, third, fourth and fifth. When you are moving, shifting up from first gear will skip over neutral and shift you right into second gear. The only time that shifting up from first will get you into neutral is when you are not moving.
     
   • 2 Pull in the clutch lever and tap the gear lever down until it stops. This will signify first gear. Pressing the gear lever down will shift you down one step and pressing it up will shift up one step.
     
   • 3 Tap the gear lever up one click while still holding in the clutch. This will put the bike into neutral.
     
   • 4 Start the bike. The bike needs to be in neutral to start.
     
   • 5 Hold in the clutch lever and tap the shifting lever down to shift to first gear.
     
   • 6 Release the clutch slowly and give it just enough gas to get moving.
     
   • 7 Listen to the motor to know when you need to shift. If the engine is making a low grumbling noise, then it will need to be shifted down. If it is making a high squealing noise, then it needs to be shifted up.
     

I think could two things. 1. A sticky clutch from being used for awhile. Are you starting it in gear with the clutch in or in neutral then engaging first. 2. You might need a slight adjustment on your clutch. Particully if there doesn't feel like much tension on the clutch lever.

Part #6 in the link is your clutch switch. Jump the two wires together and try to start the bike in gear with the clutch lever pulled in , if it does, the switch is bad.
http://www.mrcycles.com/fiche_image_popup.asp?fveh=18093&section=680498&year=2008&make=YAMAHA&category=motorcycles&dc=792&name=HANDLE+SWITCH+LEVER

you can ride the cluthch on a bike un like a car you wont hurt it its oil lubricated constantly, sitting on the bike pull the clutch in with your left hand and click the left foot lever down in to 1st, then learn how to click it back up 1 half movement in to neutral. the neutral light will come on sfter the bike enters neutral. in first gear give the throttle on the right hand a squeeze and pull the clutch in with your left hand put foot gear selector down in to 1 st and begin to release clutch slowly. hold on as bike will engage may be jerky balance yourself! when you get moving stop! by pulling the clutch in and the hand brake as you close the throttle to stop! practice your take off many times some where safe! when you get your balance in 1st gear pick up speed and begin shifting the foot gear selector up in to 2nd gear and practice closing the throttle and breaking to a safe stop. gears are generslly 1st down 1 click 2345 and6th all up from there and neutral is 1 half a click up from 1st between 2nd gear. And dont put it in gear with the kick stand down t may stall on you

hope this helps

i dont understand, the bike shouldent start in gear with the lever out it would jump forward when you hit the start button.. there is nothing wrong with the bike by what you say its just a neutral light, witch is a switch find the neutral indicator switch and replace it and your probelms will go away or test the one you have it should test 13ohms in neutral and OL in gear
let me know how you make out