dep. of equipment

Discussion in 'Lawn Mowing' started by tiedeman, Jul 1, 2003.

  1. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    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
  2. dave80

    dave80 LawnSite Member
    Posts: 42

    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.


    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.
  3. mtdman

    mtdman LawnSite Gold Member
    Posts: 3,137

    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.

  4. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

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

    Rustic Goat LawnSite Bronze Member
    Posts: 1,194

    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.
  6. hunter

    hunter LawnSite Senior Member
    from Texas
    Posts: 254

    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.
  7. wriken

    wriken LawnSite Silver Member
    Posts: 2,154

    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.
  8. bruces

    bruces LawnSite Senior Member
    Posts: 648

    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.
  9. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    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!!!
  10. mtdman

    mtdman LawnSite Gold Member
    Posts: 3,137

    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!


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