New IRS rules for those of you that do your own tax returns.

[StoneNYC]

Take a piece of paper, write today's date on it and the following sentence: "expense all items of $500 or less." I think that will do the trick.

All my expenses are well over $500 though. Is it $500 collectively or $500 total?

For example 2 boxes of 8x10 Velvia50 that I bought last year cost over $500 for the two boxes (I actually also bought two boxes of 8x10 Acros100 as well) so how do I "do it right"? That doesn't include the lenses and camera I purchase etc.

[Steve Goldstein]

I'm not an accountant... but ISTM that this rule is for durable equipment, not expendables like film and paper.

[StoneNYC]

I'm not an accountant... but ISTM that this rule is for durable equipment, not expendables like film and paper.

Ok, I bought a Chamonix 8x10 last year, and a bunch of lenses, so I'm in the $5,000 not $500 area of expenses, are you saying with this new rule I'm not going to be able to write off aany more than $500??

[EdSawyer]

You have to depreciate it over the course of its lifetime. So $5k / X number of years = $y writeoff per year.

[Ron McElroy]

Don't you have to show and income stream to be able to depreciate equipment?

[djdister]

Don't you have to show and income stream to be able to depreciate equipment?

More than that, you have to have an established business in order to depreciate capital equipment.

[Jim Becia]

All my expenses are well over $500 though. Is it $500 collectively or $500 total?

For example 2 boxes of 8x10 Velvia50 that I bought last year cost over $500 for the two boxes (I actually also bought two boxes of 8x10 Acros100 as well) so how do I "do it right"? That doesn't include the lenses and camera I purchase etc.

Stone,

First of all, always check with your accountant. I don't know if anyone here is a tax expert, but I am fairly sure (again, check with your accountant) that you can expense more than $500 for not only equipment, but for other things like film, processing, etc., only caveat with things like film, if you bought $2000 worth of film during a year, but only used $1000 of it, you can only expense the $1000, the remaining film is added to your end of year inventory. For people like me where I do art fairs, I have a beginning inventory and an ending one. Fortunately for me, my brother in law is a good accountant. But again, talk to those who know the actual rules.

[StoneNYC]

Stone,

First of all, always check with your accountant. I don't know if anyone here is a tax expert, but I am fairly sure (again, check with your accountant) that you can expense more than $500 for not only equipment, but for other things like film, processing, etc., only caveat with things like film, if you bought $2000 worth of film during a year, but only used $1000 of it, you can only expense the $1000, the remaining film is added to your end of year inventory. For people like me where I do art fairs, I have a beginning inventory and an ending one. Fortunately for me, my brother in law is a good accountant. But again, talk to those who know the actual rules.

From the language, I think the initial post was made by an accountant.

I also have an accountant who's a whiz but this means I need to go back and catalog this stuff for him more thoroughly, he normally handles MUCH higher profile clients who are not artists so I'm sure I'll need to put this all together for him, but he generally is able to get me a decent sum of money.

Anyway, thanks, ugh, stupid IRS lol!

[BrianShaw]

Very interesting. Thanks

[Rick A]

From the language, I think the initial post was made by an accountant.

I also have an accountant who's a whiz but this means I need to go back and catalog this stuff for him more thoroughly, he normally handles MUCH higher profile clients who are not artists so I'm sure I'll need to put this all together for him, but he generally is able to get me a decent sum of money.

Anyway, thanks, ugh, stupid IRS lol!

Stone, when I had my own business, I went to the office supply store every year and bought a Dome Business accounting simplified ledger. I filled it in on a weekly and monthly basis. At the end of the year, I turned it and all other pertinent info over to my accountant. When he was finished with my taxes, he called me, I went to his office and gladly handed him a check, and never worried about anything. Two things you can't do without if you run a business, a good accountant and a good attorney.