DEPRECIATION

DEPRECIATION

Shari L. Coxford © 1991

If you use equipment for your business such as a typewriter, lawn mower, computer, car, etc., you should keep a separate record of these items for depreciation. To let a tax professional figure your depreciation, you need to give him the following information:

Date Purchased	Description	Amount Paid	% Business Use	Beg. Mile	End. Mile
2-1-91	Smith Corona 200 SD electronic typewriter	253.69	80 %
8-12-90	Sear's lawnmower	126.98	100%
12-10-89	'86 Nissan Stanza	2,600.00	50%	66298	71189

Date Purchased: Date you bought the item
Description: Brand name, model number, description of item
Amount Paid: How much you paid for the item
% Business Use: If you use the item for business only, put 100%. If you use the item for business and personal use, you'll have to estimate about what percentage of use is for business
Beginning Mileage (for cars, trucks, etc.): The mileage on your vehicle at the beginning of the year (January 1)
Ending Mileage: The mileage on your vehicle at the end of the year (December 31)

Log your mileage on January 1 and December 31 of every year you use the vehicle for business.

Another way to keep track of your business vehicle mileage, and I recommend this if you're serious about your business, is to write down the mileage every time you use the vehicle for business.

Date	Beginning Mileage	Ending Mileage	Description
1-1-91	66,100		Beginning of Year
1-5-91	66,189	66,197 *	Mrs. White's to wash windows
2-2-91	67,225	67,246 *	Home Depot to buy lawnmower blade
12-31-91		81,435	End of Year

This ending mileage reflects driving to your destination and home again. For example, when you get in your car to go to Mrs. White's, your odometer shows 66,189. You drive to Mrs. White's, wash her windows, drive home again. Once home, your odometer shows 66,197.

If you do file taxes on your business, keep your tax returns together in a manila envelope with the receipts, bookkeeping and depreciation records for each year you are in business. Your tax professional will need to see your records from the previous year to do your taxes accurately.

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Shari Coxford is a public accountant and founder of the
All Free Spot freebies web site, which
offers tons of freebies at:
Free Stuff

You may reprint this in newsletters and on Web pages as long as you
use it in its entirety, including this resource box with the author's
information. Author retains ALL copyrights. To reprint this article in
traditional print media, please contact the author at:
Shari Coxford
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