Posted: 5/29/2008 5:40:54 AM EDT
| My wife was an agent for 4 months last year. She bought a laptop which she used exclusively for her work for 3 of those months. She resigned from that position in January of this year. Should I depreciate the laptop for those three months (what is the typical span of time for laptop?), take a one time charge for the laptop, or what? (we filed an extension). She is not using it for business now. |
Her only income was for those three months of that year. I of course had income. Would it be "right" to expense the entire purchase since it was only used for three months? |
If she was expecting a 1099 as a contractor, then I guess that she was not technically a contractor. She received a W-2 from the company. She was "required" to buy all of her supplies though (laptop/office supplies/travel/etc.). Yes, we were not real pleased with this outcome, hence the switch to something else. Edit: The income from this venture was about %80 of what it cost her to do the job.  I do not think that the totals would warrant anyything more than a Sch C? or misc deductions?
|
If she was an employee, then try to deduct it as an unreimbursed employee expense. There's an income percentage you have to exceed, but I don't remember the % off the top of my head; and your income added in may make this number too large for a deduction. If she was an independent contractor, she has to file a Schedule C (or C-EZ) anyway and could theoretically deduct it as an expense from the contracting "business." But if she didn't do this work on a contract basis for anyone else during the year, then the IRS might consider it a "hobby" and disallow any deduction at all (since she didn't make more than her expenses). BTW the IRS gets persnickety about deducting computers and related stuff, so document everything. |