dep. of equipment

[tiedeman]

I am lazy and don't want to do a search...but what is the best way to figure out the deprecation of the equipments value

[dave80]

If you are asking this for tax purposes, one of the simplest ways to calculate depreciation is to estimate the life of the equipment, then depreciate over that length of time. This is called straight-line depreciation.

Example:

You pay $10,000 for a ZTR and expect it to have a useful life of 4 years. Take $10,000/4 and you have a depreciation expense of $2,500/yr. After 4 years if you still keep the equipment, you will no longer be able to deduct a depreciation expense for that particular piece of equipment. Additionally, when you look at the balance sheet for your business the equipment will have no "value" (even though it might be worth a few thousand) because you take any equipment that you have (original price) and subtract all of the accumulated depreciation to arrive at the net value of the asset.

[mtdman]

Do a 179 deduction and claim the total cost at once. I think you can claim up to $25,000 per year. No cars, no computers. Works for me.

:D

[tiedeman]

for commerical equipment then should I use a 3, 4, or 5 year depreciation set then?

[Rustic Goat]

What kind of schedule does your CPA have your equipment set up on?
Doesn't it depend of the dollar value of any given item as to how it can be scheduled?

Ask Green In Idaho.

[hunter]

under new tax laws just signed by the president you can now write off in one yearup to $100,000.00 for equipment cost in one year. and if your a corp you get to carry over your losses, can't remember for how many years, ask your CPA.

[wriken]

Originally posted by tiedeman
for commerical equipment then should I use a 3, 4, or 5 year depreciation set then?

we set the mowers up on a 3 year plan, polebarn 7 years, etc. talk to your accountant. But yes you can right off the total cost in one year, If I get this new 54" mower, I might do one of the 2003's mowers, as a total right-off.

[bruces]

Originally posted by tiedeman
I am lazy and don't want to do a search...but what is the best way to figure out the deprecation of the equipments value

For tax purposes, IRS has set lives and methods depending on type of equipment (trucks, mowers, computers, etc.

Easiest way is to check with your accountant, he probably has current equipment set up already, and if you tell him what you have bought, he can tell you depreciation on it for current year if you are not going to write it all off using section 179.

[tiedeman]

I talked to my accountant and she said that equipment is usually written off over a 7 year period. The first year the equipment value drops 14.29% and the second year is 24.49%. OUCH!!!

[mtdman]

Ask about the 179 deduction! I've always written off all our equipment using this deduction no problem. And you don't have to worry about doing it over time!

:D

[T.E.]

I asked about this and was told that I could take it, but that I can not create a loss with it. I was also told that it is $17,500.00,but that could've changed if thy passed any knew laws. You have to buy something every year in order to have any deductions also. :)

[tiedeman]

the reason for the dep of equipment is I am trying to figure out the resale value of it. I might be heading for an office position in the turf profession. I might only be a consultant for a business in the area.

[mtdman]

If that's the case, you need to talk to an accountant. I think if you resell it for more than you depreciated it, you have to reclaim some of the value, or something. I dunno, that whole thing is very tricky. That's why I did the 179 on all my equipment. Write it off all at once in one year.

And you don't have to buy something every year to do the 179 deduction. It's not like you are locked in to buying or spending every year. It's just an easier way to write off capital expenses all at once, in a single year, vs depreciating them over many years. You can do that with most big items, besides cars, computers, and other 'listed' items. My accountant told me the rule of thumb was anything over $250 you have to make a capital expense, not just a regular itemized expense.

And that big new tax law Bush signed raised the limit for small business owners, which Bush hopes will spur us all on to go out and spend money we don't have in the first place so we can hire employees we can't afford.

:dizzy: