Is A Monitor For Business Computer Deductible?
I have a duplex in which I live in the top unit and rent the bottom. I purchased a 27" and a 20" computer monitor/TV that me and my sister use for my sole proprietorship. Are these 2 monitors deductible?
Some for personal but primarily used for business. Is that good enough for a deduction?
The monitors may be considered listed property which require >50% use for a deduction. See the instructions to IRS form 4562 and IRS Publication 334 (page 34 on depreciation) for additional guidance, but it looks like you can take a depreciation deduction based on the business use of the property over the life of the monitor.
Thanks for the help guys!!!
If anybody has any info on this please write in. I havent slept for 2 days looking into this. This is my take on it and it seems to be good to be true. Say my taxable income is $100,000 i buy a 200,000 condo and put it up for rent. I pay nothing in income tax to the feds due to the 100,000 "depreciation deduction on my regular tax."
http://www.irs.gov/newsroom/article/0,,id=147085,00.html[ Edited by Palmguy30 on Date 02/02/2006 ]
I called the IRS today and they said it is true if your business is realestate (spend more than 750 hours per year ) then you can take the 50% deprecation this year and furthermore you can carry back any unused portions for 5 years. I would still love to hear from a pro
it is IRS Publication 4492
What are the stipulations on the property? Do you have to buy a home in distress and do repairs or can it be a rent ready property? Any stips on type of property, ie. condo, townhome, single family, multi family, commercial?[ Edited by estateXchange on Date 02/03/2006 ]
Palm - see my previous post. It is true if you meet the qualifications. It sounds like you get over one hurdle which is that for you, the rental would be active. If you go through the other citations I gave you, you can see if you qualify.
As you stated, this could mean a lot for you, so consider calling a trusted CPA and have a list of facts and questions for him/her. Leave them with the information and pay them for an hour or two to verify if you qualify. It will be money well spent if you do. Before visiting the CPA or enrolled agent be sure to tell them what you want to talk about. This is very new, so they may not have even read about the new law.
After reading your post, I pulled the law off the shelf at work and did a quick read and noticed the active business part and then posted the previous info. This was from a book we have that reprinted the entire bill and the interpretations put out by CCH.
Where can I find that bill online? I am very interest and would like to read the bill. If one of you can post the website, it would be greatly appreciated.
Quote:I called the IRS today and they said it is true if your business is realestate (spend more than 750 hours per year ) then you can take the 50% deprecation this year Palmguy30,
If the IRS is telling you that your business must be real estate and that you must spend more than 750 hours per year to qualify for the 50% depreciation, then they are also telling you that you must "materially" participate in an active income real estate activity. To take the Section 179 accelerated depreciation for items related to a rental property operation, you must be a real estate professional.
If you have a W-2 job, and rental property ownership is a sideline, then you will find it very difficult to spend "more than 50% of your total personal services time in all activities" (more than 2010 hours per year) in your active income real estate business.
750 hours a year I wish i could make all this happen in that short amount of time. I know i can take it . However i have partners who dont know if they can, since the code metions the deduction applies to AMT and no metion of a cap it looks like the average guy can take it. And if you really think about what you are reading it doesnt make since unless it applies to everybody. I really appreciate all the responses
this is what is so great about his site
www.danandtamsells.com
Palmguy,
You are not paying attention. The 750 hour requirement is a minimum threshhold, but you are ignoring that this 750 hours must also be more than 50% of all the personal services hours spent in all your income activities.
If you have a full time job working 2080 hours per year, then to meet the "more than 50% of your time" rule, you must document at least 2081 hours in your active income real estate business.
Newkid you are not paying attention, Realestate is all I do and I meet the 750 hour test, I know this will work for me.But my piont is why would this be set up only for me a real estate pro when the whole piont of the tax break is to spur the economy. This Irs guy i talked to on the phone probably makes 8 dollars an hour and is interpurting how depreciation has been handled in the past and what you are saying is true about the 750 hours a year and i get that. My piont is they make no mention of any limitations (including this passive activity limitation) in pub 4492. So why are you assuming the normal limitations apply? The language states that you can take this deduction against "regular tax and AMT tax". Nontheless im going shopping today for some more rental properties.
[ Edited by Palmguy30 on Date 02/20/2006 ]