depreciation question


LawnSite Member
try a book in your local library or go down to the local bookstore, they'll have them.


LawnSite Member
Central PA
Depreciation can be a big PITA. Most people use straight-line for their books, but when you figure your tax returns you have to use what is called MACRS depreciation.

Straight-line is easy. Just take the useful life of the equipment and depreciate over that time.

You buy a truck for $10,000 with a 5 yr useful life. Each year, your depreciation is $2,000 (using straight-line).

With MACRS, you have to deduct a certain percentage each year. The rates are as follows:

YR 1 - 20%
YR 2 - 32
3 - 19.2
4 - 11.52
5 - 11.52
6 - 5.76

At least those rates are for the 5 year asset category.

HTH but you really might want to talk to an accountant.


LawnSite Fanatic
zone 6
Tax guide for small business, a IRS publication.

You can deduct your equiptment 100% in the year you put in service using section 179 depreciation. Their are restrictions on vehicles though.