Depreciation of assets on a newly bought business

[AZ_2]

Hi,

I bought & paid for a business in Jan 2020. Part of the sale included assets valued at $22,700. These are itimized and range from $20.00 to $5000.00. Can I only depreciate those items over $2500.00 and anything less than that put down as deductions for this year? Since I bought them as a lump sum, I was hoping to be able to depreciate them over time as a lump sum. To itimize the ones less then $2500 will give me more deductions than I need as 2020 was an awful year. Pleas advise. Thank you!

[JoannaB2]

Yes, you may expense any small assets less than $2,500, and asset over $2,500 must be depreciated over a period of time.  The start-up are cost paid or incurred in connection with the creation or acquisition of an active trade or business.  It includes advertising, salaries and wages, travel related to acquiring the business, market research, and many more.  You may deduct up to $5,000 start up cost and the remainder must be amortized over 15 years.

See, deducting business expenses, link for more information. 

[Critter-3]

Although you can expenses items under $2500  there is no rule that says you must expense them.  Instead if you want to take the deduction over a longer time frame you can do so by depreciating them.