Purchasing power tools under investment property LLC

[Mark Bouman]

Like any good Dutchman I waited until the big box stores had their after thanksgiving sales to buy some much needed power tools for my investment property. I purchased the tools with my investment property LLC credit card and wondered if it is possible and/or favorable to depreciate these assets? I bought a power tool combo set as well as an air compressor set. Any advice is greatly appreciated!

Thanks,

Mark

[James Triano]

@Mark Bouman

It's probably more of an administrative pain than it's worth to depreciate them as a fixed asset.  It's certainly something you can do and is probably the correct accounting treatment but this is really a judgement call on your part.  Unless you bought an air compressor that's commercial grade and over $2,000 or so, it's probably not worth your time.  I would just expense them in the current year.  

As far as favorable/unfavorable to your current year taxes, it's just a matter or timing those expenses.  If you need some of the write-offs this year, then expense them.  If not, then you can certainly add them to a fixed asset ledge and depreciate them.  Taxes are all a matter of timing.