Depreciation of Household Inventory

[melilley]

Last year was my first year doing dc. I just made an appointment with a woman who has been doing daycare taxes for 13 years and has also been involved with providers who were audited. I asked her about depreciating my household items that I had before I opened and she told me to only make a list of newer expensive things. I thought you were supposed to take inventory of everything you owned before you started dc and are using now.

What form does this stuff go on so I can show her or what should I tell her? I have the Record Keeping Guide and have been taking inventory as shown and I'm worried she won't put any of it on my tax forms.

[TomCopeland]

Depreciation

Last year was my first year doing dc. I just made an appointment with a woman who has been doing daycare taxes for 13 years and has also been involved with providers who were audited. I asked her about depreciating my household items that I had before I opened and she told me to only make a list of newer expensive things. I thought you were supposed to take inventory of everything you owned before you started dc and are using now.

What form does this stuff go on so I can show her or what should I tell her? I have the Record Keeping Guide and have been taking inventory as shown and I'm worried she won't put any of it on my tax forms.

You are not required to depreciate everything you own, but you can and should. The more items you include the higher your deductions. You can lump items together to make things easier for your tax preparer (8 chairs, 100 childrens books, 14 place settings, etc.). A lot of small items do add up.

[TomCopeland]

depreciation

Last year was my first year doing dc. I just made an appointment with a woman who has been doing daycare taxes for 13 years and has also been involved with providers who were audited. I asked her about depreciating my household items that I had before I opened and she told me to only make a list of newer expensive things. I thought you were supposed to take inventory of everything you owned before you started dc and are using now.

What form does this stuff go on so I can show her or what should I tell her? I have the Record Keeping Guide and have been taking inventory as shown and I'm worried she won't put any of it on my tax forms.

I forgot to add that to recapture previously unclaimed depreciation, use IRS Form 3115.

[melilley]

Thank you so much!!!!

[melilley]

One more question please. I have a dc room where I bought most of the toys from garage sales. Can I write them all down and total the fair market value and put the total amount under toys-in mmk? I bought them specifically to open my dc. I literally bought around 50-75 toys. I'm also assuming these can be considered start up costs since I bought them before opening, for the dc, am I correct?

The other toys that I had before the dc, I have been depreciating.

For example I bought 50 different toys at several garage sales, can I just add them up and put let's say $100 for toys? or do I have to list them one by one. Same question for depreciating the toys I already had.

TIA

[melilley]

I did a grand total of toys that I purchased at garage sales for my dc and entered the grand total in MMK under toys. Is that ok?

I do have a separate list of each toy and fair market/garage sale value for my records as well.

[TomCopeland]

Depreciation

One more question please. I have a dc room where I bought most of the toys from garage sales. Can I write them all down and total the fair market value and put the total amount under toys-in mmk? I bought them specifically to open my dc. I literally bought around 50-75 toys. I'm also assuming these can be considered start up costs since I bought them before opening, for the dc, am I correct?

The other toys that I had before the dc, I have been depreciating.

For example I bought 50 different toys at several garage sales, can I just add them up and put let's say $100 for toys? or do I have to list them one by one. Same question for depreciating the toys I already had.

TIA

Yes, these are start up costs and can be deducted based on their price at the garage sales. Yes, deduct them as $100 toys or lump them together when depreciating the other toys. Enter it in MM as toys.

[melilley]

Thank you so much!