Skip to main content
September 30, 2023
Solved

Where deduct tools used in home business?

  • September 30, 2023
  • 1 reply
  • 0 views

I have a home business (LLC) that includes selling items I assemble from parts.  Am I able to deduct the cost of tools, containers, etc?

Best answer by Anonymous_

You can either depreciate the tools, containers, and machinery if their cost bases are significant, deduct them as supplies if their costs are minimal, or use the de minimis safe harbor for items that cost $2,500 or less.

 

See https://www.irs.gov/businesses/small-businesses-self-employed/tangible-property-final-regulations

 

 

Untitled.png2.png

1 reply

Employee
September 30, 2023

You can either depreciate the tools, containers, and machinery if their cost bases are significant, deduct them as supplies if their costs are minimal, or use the de minimis safe harbor for items that cost $2,500 or less.

 

See https://www.irs.gov/businesses/small-businesses-self-employed/tangible-property-final-regulations

 

 

Untitled.png2.png

rwom1217Author
September 30, 2023

This was super helpful with the guidance graphics/arrows.  Thank you.  Is there a threshold where an item's cost requires it to be treated as an asset vs a misc expense, or is it my choice?

 

 

Employee
September 30, 2023

$200 or $2,500 or less for the safe harbor de minimis election.