Computer Deduction Scenarios
Scenario: Mixed use of the computer
Input a partial depreciation of the computer – in keeping with the percentage of use you make of it for business purposes – as a miscellaneous itemized expense line item.
Scenario: Business use of exterior disk drives
These commons tax deductions for small business owners fit under the supplies category. Be careful: if using external disk drives to back up personal photos as well as business files, deductions are limited!
Scenario: Computer purchased initially for a business startup
It is possible to realize a deduction for a business computer -- if you anticipate its future mixed use. TurboTax outlines that accelerated depreciation makes it possible to realize the lion’s share of the depreciation in the first year.
This is referred to as a Section 179 deduction. Yet tread lightly, especially if you later on sell the depreciable asset at a fiscal gain. If you start and sell a business and the equipment with it, there is a chance that you are liable for declaring the financial gain derived from selling the computer as income.