Anonymous asked in Business & FinanceTaxesUnited States · 1 month ago

First time doing a 1099-K Tax form! Need help on deducting expenses and assets please. ?

So I am trying to do my taxes for the 2019 year. I have never done a 1099-K form so this is all new to me. I've read that if I'm trying to deduct "supplies expenses" I should stick to small items. I've also read that if I'm trying to deduct "assets" I should stick to larger purchases over $250 such as computers, phones, etc. 

Question 1: For supplies, if I bought an item in 2016 or 2018 and are using it for my business in 2019, can I deduct it in my 2019 tax return? Or does the item I am trying to deduct MUST be purchased in the same year (in this case 2019) for me to be able to list it as a deduction in 2019?Question 2: For assets, I have the same question, if I bought my computer in 2017 and are using it in 2019 to conduct business, can I list my computer on my 2019 tax return as a deductible? 

Question 3: I've read that listing any supply as an "expense" is alot easier than listing "assets", should I just avoid "assets" all together and list everything as an "expense"?

If it helps at all, I live in southern California. Thank you so much in advance! I've been trying to figure this out for the last hour or so and can't figure it out. 

4 Answers

  • 1 month ago
    Favourite answer

    1. NO.  You need to purchase the items in the tax year

    2. NO.   You did not incur any expenses in the tax year.  It was paid for long ago

    "I've read that if I'm trying to deduct "supplies expenses" I should stick to small items"

    - Don't listen to whoever told you this.  You deduct/depreciate  the expenses you incurred.  Not claiming expense is TAX FRAUD, just like not claiming income.

    Assets have nothing to do with your tax return unless

    1. It was incurred during the current year

    2. It's related to cost of goods sold.

  • 1 month ago

    You are out of your depth.  Get professional help.

  • NA
    Lv 7
    1 month ago

    Get an extension and hire someone.  For example, while you convert a personal use asset to a business asset, your cost basis is the lesser of purchase price of fair market value.  Computers go down in value quickly and you are limited further by percentage of business use.

  • 1 month ago

    You can only deduct expenses incurred in 2019.  Assets you depreciate, not deduct.  You need receipts for any deduction.

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