This contains the main question I've been wanting to have answered.
As a business, what happens when I receive an item worth $100 and sell it for $40? Does that mean it is a loss of $60? I would assume so.. and then the losses could end up equalling or exceeding the "income" of the value of the goods.. I wouldn't think you would also report the $40 as income because that is already reported as your $100-$40 calculation. Or, to be more accurate, if you follow the rules to NOT sell until 6 months later, then do you have to be accurate at calcuating the depreciation of those items so that it wold no longer be $100-$40 but maybe $60-$40? And then do you have to supply evidence to the depreciation? If you do need to account for depreciation, then what about for the items that are never sold that would also depreciate? Do you need to deduct that depreciation as a business expenses?
