jankin <chagin_one[at]yahoo.com> wrote:
- quote -

Not quite. The deprecition tax form (Form 4562) has a
section on top to calculate the Section 179 deduction. This
deduction allows you to elect to expense this year up to
$100,000 (this amount changes from time to time)in qualified
equipment purchases rather than depreciate the equipment and
deduct it over several years.

Since your computer cost you less than $100,000, you can
elect to expense it all this year. Be Aware - you must fill
out this section of Form 4562 and attach it to your 2003
return. You can't go back later and make this election!

However without Section 179, you would be correct.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

jankin <chagin_one[at]yahoo.com> wrote:
- quote -

Wrong. Look up Section 179 under depreciation. You are
allowed to deduct (in the year purchased) the entire cost of
most items up to a fixed limit, which I think is $25,000
this year. I have always been under even the old limit of
$7000 so I's not sure what the current limit is.

--
Vic Roberts
http://www.RobertsResearchInc.com

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

jankin wrote:

- quote -

Depreciation IS your deduction for the computer's cost
(including "179" as depreciation). You can't deduct it
twice.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

jankin <chagin_one[at]yahoo.com> wrote:
- quote -

If I spend $2,000 on a computer, and 5 years later I scrap
it as worthless, my total cost is $2,000. I do not get to
add the $2,000 loss of value to the $2,000 upfront cost,
because I paid out $2,000, not $4,000.

Now I can take the $2,000 upfront as a Section 179 expense,
or I can take the $2,000 over 5 years as depreciation.
Either way I spent $2,000, and I get $2,000 in deductions.
The decision often depends on whether I can get full use of
the Section 179 this year; for example, if I will be paying
taxes in higher brackets in later years, I may forego the
Section 179 and reap greater benefits from the depreciation
in the out-years.

--
Chris Green

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

eagent[at]alliancetax.com says...
- quote -

OK - now that I have the first part of the answer finally
into my thick skull (i.e. deduction and depreciation are
mutually exclusive), the implied second part is that I can
NOT deduct the whole cost in one year, I MUST do it via
depreciation across multiple years, right? thanks

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

shag[at]nospam.com says...
- quote -

Not necessarily obvious, since there is a cost of the
machine, and the cost of its subsequent loss of value.
Nevertheless, despite your tone, thank you for your answer.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

"jankin" <chagin_one[at]yahoo.com> wrote:

- quote -

Depreciation IS how you deduct the cost of assets on a tax
return.

Gene E. Utterback, EA

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

"jankin" <chagin_one[at]yahoo.com> wrote:

- quote -

Do you think you should be able to deduct the same cost
twice? Once by a full write-off then again over time thru
Depreciation? The answer to your question is obvious.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

For a schedule C type home business, having bought a
computer for it, can I not only deduct the machine cost but
also take the depreciation? Or does taking depreciation
disallow the computer's cost?

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->