Question

Which of the following is true with regards to writing off the costs of computer and telecommunications expenses on your tax return?

It's best to depreciate the items over time.

It's best to expense the purchase during the tax year the purchase was made.

Only 50% of the cost of the items can be written off as a business expense.

These expenses can't be written off on a personal tax return.

Answer 1

It's best to expense the purchase during the tax year the purchase was made with regards to writing off the costs of computer and telecommunications expenses on your tax return.

Explanation:

Mostly business costs are depreciated in the year when they are occurred. In few cases cost is applied at the beginning of the business, costs that may be occurred previously of beginning process. These kind of costs are exploited over five years, it is strange but they are depreciated directly once the business is open.

Decreasing the costs of starting a business may be preferred if the business shows loss for the first or second year. But it is better to ignore the need to capitalize these costs by delaying the payment on invoices.