New software or printers

[tsukada2006]

Our company is a Consulting company:

In general, when a new software program is purchased because the new client's system is run with a different software program (not reimbursed). The software is an upgrade to our software so naturally we would use this as well. The majority of the time, we are working on the client's needs and a small portion with personal use. How should we track these different segments/portions of the costs within our taxes?

The same questions of how to show on our QB Online office product value for the future years within our taxes when we did not pay for the printer. This printer WAS paid for by the client and used the majority of the time with their business (for now) and a small portion for personal.

[LindaSh]

The deductibility of software or printers purchased is determined by who owns it.

Anytime a business purchases a printer or software in their name for the purposes of servicing clients or using for their own business, then they would receive the full deduction for that purchase.   If that purchase is $2,500 or less, the company can expense it.  If it is greater than $2,500, the company would capitalize the purchase.   You would not break out a portion for the business and a portion for the client unless you both own the asset.  If that is the case, you would deduct based on your portion of ownership, which should be in a written agreement signed by all parties.

There are companies which may charge a software fee to help cover the costs of the software when they are using it for client purposes.  Such a fee would be added to your business income and can be deducted by the client on their taxes if it is for their business and not their personal use.

If the client owns the software and/or printers, they would be able to deduct the expense.  There is no tax issue if they allow you access to the software and/or printer so that you can service them.  

If the company is purchasing software and/or printers which they will sell to a customer, then that is considered inventory; which, depending on the state, may or may not be subject to sales tax.

[Michele C1]

The IRS does acknowledge certain de minimus "fringe benefits" usually in relation to employees.  This rather sounds like your use of the software personally may fall into that category.  If it is a very small percentage which would be allocated to personal use it could be argued that use is de minimus.  On the other hand, if the personal use is material and measurable you could allocate part of the expense paid by your company as non-deductible.   

Keep in mind if your company bills out the cost of the software and printers then pays for it yourself, it is your company's deduction.  You have picked up the income and will deduct the expense.

[Fackither68]

For managing the costs associated with software and equipment that are used partially for business and partially for personal use, it’s crucial to maintain accurate records.

You should consider tracking the percentage of usage for both personal and business purposes. This can be done by keeping detailed logs or using software that allows you to allocate costs proportionally. For tax purposes, only the portion of the cost attributable to business use can typically be claimed as a deduction.

Regarding the printer paid for by the client but used partially for personal use, you should account for it similarly. Track the usage split between client work and personal use, and only allocate the business portion for tax deductions.

For more detailed advice and assistance, you might want to refer to the history of the internet of things (IoT) and how technology has evolved in managing such needs. I recently reached out to Cogniteq for their expertise on integrating such solutions effectively.