inventory for home staging

[superior interior staging]

Is the furniture and items owned considered inventory 

We have a general partnership

[DavidD66]

No, not inventory - unless you're in the furniture business.  Inventory is your supply of products you sell and/or use to make the products you sell.  If you provide services, then you would have no inventory.  Your furniture and items owned would be fixed assets (furniture and fixtures) or expense items, depending upon the cost.

[superior interior staging]

Thanks 

So do we list it as an expense or an asset on your forms.

Also, we use our personal vehicles so do we take the mileage on our personal returns?

[ThomasM125]

You need to add your furniture and fixtures in the assets/depreciation section where you enter your business expenses. When you add each asset, you may be given the option to take an expense allowance for the item, in the form of a "section 179" deduction or "special depreciation" allowance.

If you choose one of those options, you may be able to deduct as an expense the full cost of the item purchased in the year that you purchased it. Otherwise, you would have to deduct the cost in the form of depreciation over a period of years.

If you are filing a partnership return, then you would deduct the business use of the auto on your partnership return. 

[superior interior staging]

How do I get help from Turbo Tax on this return? What is the best phone number to call

I put the amount in the asset area and it is not letting me take . as an expense at all and showing a profit of 17k 

This is our first year of business and these are real expenses, 

Just paid $200 bucks for this program and need a real person to speak with directly.

[CatinaT1]

Here is how you can connect with a Tax Expert.

[REI-hiker]

@DavidD66  @ThomasM125  I have a fix & flip business for houses. I purchased some furniture to use for staging so I don’t have to keep renting it. Can I deduct the full amount the first year? Would it be as an accelerated/bonus depreciation, Section 179 expenses, or just normal expenses?

 Thank you!

[VictoriaD75]

You must list the furniture as a business asset and elect the depreciation method. If the asset is less than $2,500, you may expense it using the safe harbor election. You may also opt for Section 179 or bonus depreciation. Keep in mind, when you take 100% of the depreciation in the current year, you do not have any expense to carry forward into future tax years. Use depreciation as a tax strategy. If you already have adequate expenses to limit your business income, you may want to use some of that depreciation in the future. 

Business Safe Harbor Election

Depreciation of Business Assets

[Carl]

Something a lot of folks don't seem to understand about depreciation.

All depreciation, including SEC 179 and the special depreciation allowance is not a permanent deduction. In the future when you sell or otherwise dispose of the business and/or assets, all depreciation taken is recaptured and taxed in the year of sale or disposition. So while you'll see us use the term "depreciation deduction", it's important to understand that deduction is not permanent.

There is one instance when that depreciation may (or may not) become permanent. That's when the owner of the business or asset dies while the asset is still "In use" for the production of income and it gets passed to a heir.

[REI-hiker]

@VictoriaD75 @Carl This is very helpful thank you both!! It’s important to make this distinction especially since I’m dealing with flips and not rentals and want to lower my current year taxable income as much as possible. Sounds like utilizing the safe harbor election will be my best bet for my staging furniture. Thanks again!