I need more help. I am in over my head . Opened a fitness business in the lower park for my house in September. I know enough but not enough as I have questions. Spent $7728 to redo my lower level - I was told this is a capital asset and it needed to be depreciated. The system assigned 39 years life and calculated $58.00 - I can't recreate this amount. I am not depreciating the "space" or designated % of this area. Should I? If I do, I need to find the cost basis, adjusted cost basis and market value?
I also have equipment costs totaling 11,300.00. $5,578.00 of the $11,300 is for a treadmill that qualifies for depreciation. The remaining 5721 for weights, weight rack, balance chair, band system & ropes. Can I expense this remaining amount? There is also furniture purchased ---leather chair, 2 seat sofa. OR do I expense those items $200 or less and depreciated everything else above that amount?
Thank You in advance.
Your improvements are being depreciated on a straight line basis over 39 years beginning in September. The percentage is 0.749%.
The IRS allows you to expense any item costing $2,500 or less. Anything above that can be entered as an asset and written off using Section 179.