<StoneMountain66[at]gmail.com> wrote
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The taxing authority (federal, state, sales tax, etc) will try to call it
income at the earliest time.

If it's not refundable....then it's income when received, or the later of
when the refund period lapses (ie: if no refunds within 10 days), or at the
end, when the services are rendered.




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If you're asking if the deposit is subject to sales tax, ask yoru
state/local agency.

As far as when any lodging tax/sales tax would be due, it should follow the
recognition of the income.




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If it's a taxable "sale", then it's taxable when you would record that
transaction as income. If all the events have happened for the money
received, meaning they give you a deposit that is
never-ever-in-a-million-years-going-to-be-refunded, then it's income (and
subject to sales tax) when received. If it could be refunded, it's a
liability on your books. It becomes income (and subject to sales tax) when
you've met your end of the deal (you held the room for them).




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No.



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$600 isn't a small asset. cApitalize it and if you elect, take Section 179
to expense it in that fashion. If audited, and they reclassify those types
of expenses (and they will), you lose the option to deduct through 179 and
have to depreciate over 7 years.





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Leasehold improvements are over 39 years for commercial property, regardless
of the term of the lease.





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Congress decided.






--
Paul A. Thomas, CPA
Athens, Georgia

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Two questions from a week-end bed and breakfast type company:

When is it income?
For example, weekend balance is due 30 days before arrival.
Guests pay Dec. 2007 for January 20th 2008 retreat.
Is the income and sales tax 4th quarter 2007 (when we recieve it)
OR first quarter 2008 (when we earn it)?

Sales tax on deposit?
Similar question to the one above. We require a $50 deposit to
reserved
a spot for a weekend. We charge tax on the deposit to keep each
payment at the
county required 3.7% sales tax. It that correct? (we aren't filing the
sales tax until the quarter they arrive)

When is it a Fixed Asset?
Is every purchase under $1000 an expense? For example, we bought an
espresso
machine for $600. Do we have to expense this long-lived asset
over multiple years through depreciation deductions?

Lease building improvement over $1000
Is a lease building improvement that cost over $1000 just a fixed
asset?
Or does it have to be a separate fixed asset category, - to be
expensed over multiple
years through depreciation?

Depreciation occurs of a number of years. How is the number of years
determined?

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >