2. misc-audio
  3. 160362-1601

Audio tax write-off

Hello,

I have a company that produces documentaries and podcasts on personal and commercial histories. I have needed to acquire computer equipment to do my work, and I've borrowed some equipment from my 2-channel system, such as headphones, as well. My question is, do any of you write off home audio audio acquisitions for your business? Do you know the tax rules on this? Does it have to be branded  as "pro" gear to qualify? Thinking I need a better DAC and studio monitors. If I bought a component called "Schiit," would the tax auditor go "nnnnnnnnnnoooooo?" 

Thanks for your input.

Paul


paulburnett
djones51
4,947 posts
 
Ask a CPA, tax attorney or tax authority if these types of acquisitions are expendable supply or capital assets. You should of made these decisions when you set up your business what $$ amount is considered expendable supply? 
abnerjack
231 posts
 
I'm not a CPA, but I did retire as a Tax Law Specialist from the IRS and trained accountants and tax preparers; I addressed this particular issue hundreds of times.  

As I mentioned above, it must first be determined what sort of tax entity you are:  sole prop, corp, etc...

Frank jumped to the conclusion that you are a sole proprietor and gave you some off-the -cuff information.

Any free advice you receive here is probably worth what you paid for it.
tomic601's avatar
tomic601
13,182 posts
 
Caesar had roads....


abnerjack
231 posts
 
djones,  as I mentioned above, we're talking about assets that have a useful life expectancy of greater than 1 year and are depreciable assets, not supplies.  They maybe be deductible as capital assets, subject to the depreciation rules,  In some cases they may be deducted in full as section 179 expense, but these rules are not simple and cannot  be addressed here, in my opinion.
abnerjack
231 posts
 
Sale of depreciable assets in a business is generally not capital gains tax, but can be taxable as recapture of a depreciable asset.

From investopedia:

Depreciation recapture is the gain realized by the sale of depreciable capital property that must be reported as ordinary income for tax purposes. Depreciation recapture is assessed when the sale price of an asset exceeds the tax basis or adjusted cost basis
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