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Hey Tom I went to one of your seminars and as I am going over my notes I see I made a note about claiming bigger purchases as a depreciation. My question is anything over $100 you claim as depreciation so if I bought a tv stand at 169.00 would I take my t/s off that or just turn it in to depreciate at the actual $169.00 that I paid for it? TIA
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Depreciation
When claiming expenses you follow these 3 steps.
First, is it deductible? A tv stand is deductible because you are using it in your business.
Second, how much is deductible? If you use something 100% of the time for your business you can deduct all of it. If it's also used by your family, deduct the time-space % of the cost.
Third, when can I deduct it? The general rule is that if it costs more than $100 you must depreciate it. A tv stand is considered property that must be depreciated over 7 years.
However there are several exceptions. If you bought the new tv stand in 2011, you can use a new 100% bonus rule that allows you to deduct the business portion all in 2011. Put on Form 4562, line 14. The 100% rule expired 12/31/11. In 2012 we have a 50% rule that allows you to deduct 50% of the business portion the first year, and depreciate the rest over 7 years.
If you used the tv stand more than 50% of the time in your business, you can use the Section 179 rule that allows you to deduct the business portion all in 2011.
Aren't you glad you asked?
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