Sole prop buying a trailer

Forum|Forum|2 years ago
October 25, 2023
1 reply
21 views

Started a sole proprietorship this year. Selling handmade goods online and in person. Interested in buying a small trailer for transporting my booth setup for markets/craft fairs/vendor shows. Since starting later in the year, my sales will only end up around $4000. The used trailer would be about $2000. I have other startup expenses totaling around $600. Can I go ahead and have the business buy the trailer this year or should I buy it personally and have the business buy it from me next year when sales number will (hopefully) higher?

Ask the Experts - Extension - Sept 2023

carmen_t

Level 5

Hello and thank you for your question. Based on your description the business has enough cash to purchase the trailer as noted $4,000 in sales and $600 in expenses, specifically start up. If trailer is purchased I would look into possible section 179 deduction or capitalzing and depreciating over the useful life of the trailer. If Section 179 is utilized, the full purchase price will be used or you can choose to depreciate over the useful life of trailer. I will insert link to clarify more on Section 179. Have a great day!

From TurboTax "What is Section 179 deduction?"