4 ms·

Yeah, this is all made up buddy. The dollar value is not a consideration. There’s no such thing as $1M cap. Or any cap. The salient thing here is how long they

Yeah, this is all made up buddy. The dollar value is not a consideration. There’s no such thing as $1M cap. Or any cap. The salient thing here is how long they are expected to last. Super cheap items are generally not going to last very long so yes they do trend towards expensing. There is ABSOLUTELY no requirement that a capital asset be sellable or have any market value. You get an F-

lazide 2y ago
You need a much better accountant. Tax code section 179. With the 1 million cap. It gets adjusted, and was recently 1.222 million I believe. [https://www.law.cornell.edu/uscode/text/26/179 https://www.law.cornell.edu/uscode/text/26/179] “ (a) Treatment as expenses A taxpayer may elect to treat the cost of any section 179 property as an expense which is not chargeable to capital account. Any cost so treated shall be allowed as a deduction for the taxable year in which the section 179 property is placed in service. (b) Limitations (1) Dollar limitation The aggregate cost which may be taken into account under subsection (a) for any taxable year shall not exceed $1,000,000.” [https://www.executech.com/insights/1-million-deduction-for-new-equipment/ https://www.executech.com/insights/1-million-deduction-for-n...] For something to be considered an asset, it has to generally be “property owned by a person or company, regarded as having value and available to meet debts, commitments, or legacies.” While there are certainly edge cases where something would be impossible to sell or value on a market but still considered an asset; that gets pretty murky for a number of reasons no? An asset which no one would ever buy is also going to be hard to consider something which someone would take as payment for a debt, meet a commitment, or leave as a legacy. Even a pile of beany babies has some articulable value. If it isn’t an asset, it is likely an expense. Most businesses do not account for or attempt to track the things I’ve been calling out (hand tools, etc.) at the level they consider them assets. Any more than they track a desk or whatever. It’s de minimus. Would they get worked up if someone walked off with them? Sure. But they aren’t depreciating their stocks of beaten up wrenches or counting their hammers each year, anymore than they are doing that for desks. Unless they have a really bored group of bean counters or are so large they have no choice, because they literally bought like 10k desks and now that is real money. Excavators, bobcats, etc? Yeah. Everyone is tracking those unless they’re really screwing up their taxes.
- jncfhnb 2y ago
  A specific election you can take is not at all the same as “you can do whatever”. Your writing heavily implied that they won’t penalize you for getting things wrong up to $1M. That’s flagrantly wrong. Assets do not need to be sellable. Goodwill is an asset. It’s a not “real” thing. The book value is also completely unrelated to the market value. You have quoted a dictionary definition of the word “asset” from Oxford languages off of Google. You do realize we are not talking about about generic language but specific technical accounting definitions right? Desks are 100% capital assets. Office furniture has a specific useful life defined by the IRS. Feel free to Google this basic information.
  - lazide 2y ago
    Nope. That exemption means you can either track them as capital assets and depreciate them, or take them as straight up business expenses in the year you qualify. It’s right in that first paragraph I quoted. Bullet a. Aka ‘whatever’. You would need to decide though. If you have a different definition of asset that includes ‘something of no market value’, then feel free to provide a reference. If you buy something you can’t sell later for money, it isn’t an asset anymore. Its economic value has been consumed, and it was an expense.
    - jncfhnb 2y ago
      There are some exceptions to 179, and even then it’s an election. You have specifically invoke it, It’s not a catch all for oopsies on your taxes. I already gave you an example. Goodwill.
      - lazide 2y ago
        I’m really not sure what you’re trying to say. I never said it was an ‘oopsies’? In fact, I said you needed to decide which option to take. But it’s up to you. And Goodwill is definitely sellable/marketable in most cases, as it includes a number of valuable things like IP, brand value, etc. and typically occurs to track those things when an acquisition happens and someone pays money for them. And it gets concrete dollar amounts. You’re just flailing around, F-. And you definitely need a better accountant.

lazide 2y ago

You need a much better accountant. Tax code section 179. With the 1 million cap. It gets adjusted, and was recently 1.222 million I believe. [https://www.law.cornell.edu/uscode/text/26/179 https://www.law.cornell.edu/uscode/text/26/179] “ (a) Treatment as expenses A taxpayer may elect to treat the cost of any section 179 property as an expense which is not chargeable to capital account. Any cost so treated shall be allowed as a deduction for the taxable year in which the section 179 property is placed in service. (b) Limitations (1) Dollar limitation The aggregate cost which may be taken into account under subsection (a) for any taxable year shall not exceed $1,000,000.” [https://www.executech.com/insights/1-million-deduction-for-new-equipment/ https://www.executech.com/insights/1-million-deduction-for-n...] For something to be considered an asset, it has to generally be “property owned by a person or company, regarded as having value and available to meet debts, commitments, or legacies.” While there are certainly edge cases where something would be impossible to sell or value on a market but still considered an asset; that gets pretty murky for a number of reasons no? An asset which no one would ever buy is also going to be hard to consider something which someone would take as payment for a debt, meet a commitment, or leave as a legacy. Even a pile of beany babies has some articulable value. If it isn’t an asset, it is likely an expense. Most businesses do not account for or attempt to track the things I’ve been calling out (hand tools, etc.) at the level they consider them assets. Any more than they track a desk or whatever. It’s de minimus. Would they get worked up if someone walked off with them? Sure. But they aren’t depreciating their stocks of beaten up wrenches or counting their hammers each year, anymore than they are doing that for desks. Unless they have a really bored group of bean counters or are so large they have no choice, because they literally bought like 10k desks and now that is real money. Excavators, bobcats, etc? Yeah. Everyone is tracking those unless they’re really screwing up their taxes.

jncfhnb 2y ago
A specific election you can take is not at all the same as “you can do whatever”. Your writing heavily implied that they won’t penalize you for getting things wrong up to $1M. That’s flagrantly wrong. Assets do not need to be sellable. Goodwill is an asset. It’s a not “real” thing. The book value is also completely unrelated to the market value. You have quoted a dictionary definition of the word “asset” from Oxford languages off of Google. You do realize we are not talking about about generic language but specific technical accounting definitions right? Desks are 100% capital assets. Office furniture has a specific useful life defined by the IRS. Feel free to Google this basic information.
- lazide 2y ago
  Nope. That exemption means you can either track them as capital assets and depreciate them, or take them as straight up business expenses in the year you qualify. It’s right in that first paragraph I quoted. Bullet a. Aka ‘whatever’. You would need to decide though. If you have a different definition of asset that includes ‘something of no market value’, then feel free to provide a reference. If you buy something you can’t sell later for money, it isn’t an asset anymore. Its economic value has been consumed, and it was an expense.
  - jncfhnb 2y ago
    There are some exceptions to 179, and even then it’s an election. You have specifically invoke it, It’s not a catch all for oopsies on your taxes. I already gave you an example. Goodwill.
    - lazide 2y ago
      I’m really not sure what you’re trying to say. I never said it was an ‘oopsies’? In fact, I said you needed to decide which option to take. But it’s up to you. And Goodwill is definitely sellable/marketable in most cases, as it includes a number of valuable things like IP, brand value, etc. and typically occurs to track those things when an acquisition happens and someone pays money for them. And it gets concrete dollar amounts. You’re just flailing around, F-. And you definitely need a better accountant.