MichaelMc
New Member

Deductions & credits

The tractor, by IRS rule, has a 3 - 5 year useful life. You will want to depreciate it over 5 years.

Entering your information in TurboTax, treat it as a business asset, so the depreciation calculations are activated. Do not select any of the options for special depreciation or Sec. 179.

You are presented with four asset-type choices, none of which appear to describe your tractor, but select "trailers," which will set the appropriate 5 year useful life. The default in TurboTax is set to the 200DB depreciation method, with a mid-quarter convention, which is perfect for your circumstances. This will, in the 2018 tax year, deduct depreciation expense as if the asset was put in service November 15, the middle of the last quarter of the year. This will leave most of the value to be depreciated in the following years, when you will be using the tractor to create more income.