What Category Should This Go?

[tenderhearts]

I bought a tablet that I use for both daycare and personal use for $119. Does this go under ts% supplies??

[Michael]

That would be something that you can depreciate year to year if used for your business. Here are some threads on deductions - computer: https://www.daycare.com/forum/tags.p...ion+-+computer

[TomCopeland]

deductions

I bought a tablet that I use for both daycare and personal use for $119. Does this go under ts% supplies??

Any expense less than $2,500 may be deducted in one year, not depreciated. Since it's used for both business and personal purposes, use your time-space % to determine the business portion to deduct.

[tenderhearts]

Thank you Tom, so does this apply to anything that is expected to be in business longer than a year, such as a futon we bought for the daycare (100% business) that cost $399.99? Depreciated or claim all in one year??

[TomCopeland]

expense

Thank you Tom, so does this apply to anything that is expected to be in business longer than a year, such as a futon we bought for the daycare (100% business) that cost $399.99? Depreciated or claim all in one year??

The $2,500 rule applies to any item, whether or not it lasts longer than one year. Deduct your 100% futon in one year.

[tenderhearts]

Would these items like futon just go in with supplies then? Sorry

[TomCopeland]

futon

Would these items like futon just go in with supplies then? Sorry

You can list expenses under any category you want. You can call the futon supplies or household items or just list it as a futon under Other Expenses.

[tenderhearts]

OK thank you very much

[tenderhearts]

Sorry but I have another question. I was reading through your blog about the $2500 rule. So when I submit these items to my tax preparer, do I need to let her know of these items and tell her I want to use this rule?

[tenderhearts]

In addition to my previous question I was looking at the examples and I was curious as to the swing set example

Here are some examples of how to use this rule. We will use a Time-Space Percentage of 35% in these examples.

$190 stroller used 100% for business = $190 deduction. No need to attach a statement because it’s less than $200.
$2,000 washer and dryer x 35% = $700 deduction. Attach a statement.
$3,600 swing set x 35% = $1,260 deduction. Depreciate over 7 years.
$3,600 swing set used 75% for business = $2,700 deduction. Use Section 179 rule and deduct in one year on Form 4562.

Why can't the swing set be put under the $2500 rule if the deduction is less than $2500 or is it because the total purchase is more than $2500?

Sorry I'm just trying to understand...

[TomCopeland]

deductions

In addition to my previous question I was looking at the examples and I was curious as to the swing set example

Here are some examples of how to use this rule. We will use a Time-Space Percentage of 35% in these examples.

$190 stroller used 100% for business = $190 deduction. No need to attach a statement because it’s less than $200.
$2,000 washer and dryer x 35% = $700 deduction. Attach a statement.
$3,600 swing set x 35% = $1,260 deduction. Depreciate over 7 years.
$3,600 swing set used 75% for business = $2,700 deduction. Use Section 179 rule and deduct in one year on Form 4562.

Why can't the swing set be put under the $2500 rule if the deduction is less than $2500 or is it because the total purchase is more than $2500?

Sorry I'm just trying to understand...

The $2500 rule applies to the cost of the item before applying your time-space %. In your example above the $3,600 swing set with a time-space % of 35%, you can use the 50% bonus depreciation rule and claim have the depreciation in the first year.