General Question

valdasta's avatar

Is my laptop tax deductable?

Asked by valdasta (2144points) January 25th, 2010

Last year I purchased a laptop to be used for my business. Is this considered a fixed asset, and therefore, not tax deductable?

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6 Answers

CyanoticWasp's avatar

I believe that it’s “depreciable”, but not “deductable”.

Tropical_Willie's avatar

The rules use to be three years but only half a year taken the first year of ownership and half the four year…. If your lease the computer it is different.
ASK your accountant.

It has to pass certain requirement tests for usage also.

srmorgan's avatar

If you are running a business and file a schedule C with your income tax return, I believe that for 2009 you can depreciate the entire cost of the laptop under what is called a Section 179 deduction. There are limitations on this, adjusted gross income must be below $250,000,

You can only take the 179 deduction if you have generated a profit in your business and file your schedule C to reflect that. In other words, if you have a net loss for the year, a not uncommon situation, then you cannot use section 179. You may still take “normal” depreciation as @Tropical_Willie suggested, 1/6 (half of ⅓) in the year of acquisition, regardless of your profit situation but you may not take the 100% depreciation afforded under Section 179.

In this response I use 179 deduction and 179 depreciation interchangeably. The concept is the same. You are taking 100% depreciation and deducting it.

@Tropical_Willie is also correct in that you must determine how much, if any, of the total usage on the laptop might be personal and not used in trade or business. If you use it for say 30% personal use then you may only depreciate or deduct 70% of the total purchase price. By the way, your basis for depreciation does include any freight or taxes paid in the acquisition of the laptop.

As in all cases, check with a personal tax advisor to verify that your personal situation applies in this case.

jaytkay's avatar

@srmorgan I am laptop shopping and you just helped me tremendously. Thank you!

srmorgan's avatar

@jaytkay

I am a corporate type, not a personal tax expert. You might want to verify that the deductions for equipment in 2010 are the same as they were in 2009.

SRM

billgaskin11's avatar

If it’s for work yes!

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