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Is Camera equipment a 5-year property for depreciation (taxes?)

Jose Gil , Mar 21, 2006; 12:06 p.m.

Hi everyone,

Now that I'm getting some substantial sales, I plan to file as a business under US tax law next year.

I'm trying to estimate my expenses and see if I need to pay quarterly/estimated taxes. I'm trying to figure out depreciation for camera equipment, digital SLR and lenses.

Would this be the same as computer equipment, which is considered a 5-year property (20% depreciation per year from the cost basis, I believe)?

Thanks

Responses


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Art Haykin , Mar 21, 2006; 12:14 p.m.

Get thee to a good CPA.

Jose Gil , Mar 21, 2006; 03:51 p.m.

Another way to put it. Would TurboTax Premiere be good enough? Or would an accountant be necessary? This is just sideline stuff for me, not my "profession" ($3000 a year income max).

bernard korites , Mar 21, 2006; 04:12 p.m.

If it's a film camera I would say 5 years would be about right. If it's a digital I suppose you could try to deduct it as an operating expense, arguing it only has a useful life of a years or two before obsolescence sets in.

Bruce Levy , Mar 21, 2006; 04:38 p.m.

There's a fairly high "179" deduction that would usually allow you to deduct it all in one year instead of depreciating.

Jose Gil , Mar 21, 2006; 07:41 p.m.

Unfortunately I'm a renter with no dependents, so I have no tax shelter. That means I'm taking standard deductions. So that means I can't deduct any business losses. So I can only deduct business expenses as far as business income (sched C).

I'm looking to get a 5D, so that cost in a 179 would put me over my income. So it's actually better for me to use depreciation and spread it out over a few years. That'll also keep my tax owed more consistent.

Bruce Levy , Mar 21, 2006; 08:32 p.m.

I can see where you're coming from, BUT, also you should know that the IRS doesn't red flag you ordinarily for one or two years of loss. They expect you to show one or two years of profit generally over the first five years of a business. I think you should see a accountant/tax adviser. They help take the fear out of the whole process and will take what you are intitled to without your own fear and guilt getting in the way. Just slowly learn to play the game- but you need someone who knows more than you think you know.

Good luck.

Quang-Tuan Luong , Mar 21, 2006; 08:32 p.m.

Don't remember if this was 5 or 7 years. If you buy the version of Turbo Tax that can do Sch C, when you enter an asset for depreciation, it will give you a choice of categories with the correct depreciation rate, in a pull-down menu, and one of them will be photographic equipment. Terra Galleria Photography

Bruce Levy , Mar 21, 2006; 08:34 p.m.

Incidently, you CAN deduct loss. It has nothing to do with standard deductions. Two different areas. And being a renter has NOTHING to do with it.

Jose Gil , Mar 22, 2006; 03:46 a.m.

Being a renter means I don't have a tax shelter, because I don't have a mortgage. If I itemized my deductions, I'd have something like $1000 (if I'm lucky) of deductions. I'd rather take the standard deduction.

And I'm pretty sure I can't deduct business loss if I don't itemize my deductions (taking standard deductions). I could be wrong.

Glad to know that TurboTax has the drop down menu. That'll make things a lot easier.

Thanks for the help everyone.


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