Bought for business but never used


S

Steve Kraus

Years ago I acquired an extra machine for my business but never used it so
never depreciated or Sect. 179'd it. The machine is now fairly obsolete
and I'll probably junk it as soon as I get around to it. Is there a way I
can recover some of the cost? Fortunately this was a used item so I only
have a few hundred in it. Can I deduct its costs in some fashion on FY2007
taxes? It's not something that would have had potential personal use and
has just been gathering dust and taking up space all this time.

Another machine of a related type--one that generated a nice profit for me
years ago and was fully depreciated--but hadn't been used in years went to
the scrap yard a few months ago.
 
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P

Paul Thomas, CPA

Steve Kraus said:
Years ago I acquired an extra machine for my business but never used it so
never depreciated or Sect. 179'd it. The machine is now fairly obsolete
and I'll probably junk it as soon as I get around to it. Is there a way I
can recover some of the cost? Fortunately this was a used item so I only
have a few hundred in it. Can I deduct its costs in some fashion on
FY2007
taxes? It's not something that would have had potential personal use and
has just been gathering dust and taking up space all this time.

Another machine of a related type--one that generated a nice profit for me
years ago and was fully depreciated--but hadn't been used in years went to
the scrap yard a few months ago.



If you bought a piece of equipment that you didn't place in service (you
didn't use), and you rightfully didn't take any depreciation against that
equipment (because it wasn't placed in service), then it should be sitting
on your books as an asset at cost. In the year you dispose of said
equipment, you can take a deduction, a capital loss basically, at this time.
 

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