If you want to expense them for that tax year-
If the cost is less than $2,500, then you can enter it as a Other Miscellaneous business expense. Or, if you enter it as an Asset, that is where you find the Section 179 election.
How to get to that area to enter it as a Miscellaneous Expense: While inside the software and working on your return, type Schedule C in the Search at the top of the screen (you may see a magnifying glass there). There will be a popup that says Jump to Schedule C. Select that to get to the general area.
- Business Income and Expenses
- select Edit next to your business (if it is there)
- scroll to Business Expenses
- then, Other Common Business Expenses
- select that, then on the next screen you will see categories and can choose Other Miscellaneous Expenses
After selecting Other Miscellaneous Business Expenses, you will be able to type a description and the amount. For the description right "Safe Harbor Asset" or something similar next to the Computer Name.
To enter it as an Asset and take the Section 179 follow the steps above, then:
- Business Income and Expenses
- select Edit next to your business (if it is there)
- scroll to Business Assets
You will enter the details of the computer (purchase date, etc), then on the following screens you will be able to elect to Expense all or some of the cost (if you have a net profit).
Follow through all the areas in the Business section of the TurboTax software and it will provide you with a lot of assistance. You'll notice blue links that have more information and details about the particular sections that will be extremely helpful.
Also, these links may be helpful to you: IRS Small Business Help Center, Capitalization of Tangible Property - Internal Revenue Service .
