This sole prop has always earned only service income, no merchandise.
In late 2020 I bought $5,000 of used equipment as a package deal, 3 widgets total, paid by check, check memo is not itemized. No other receipt.
Widget A I resold in 2020 for a profit, widget B I hope to resell soon in 2021, and widget C I kept for business use. This was my intention when buying.
How might I handle this on schedule C? It seems like A and B are COGS, and widget C is an expense, but without an itemized receipt I think I'm disallowed from expensing widget C under the $2,500 De Minimus Safe Harbor threshold? Would I need to depreciate widget C in this case? The proportional cost of widget C I would estimate as $2,000.
