Deducting Computer Expenses

If your business or job require you to purchase a new computer, you may be able to deduct the cost as a business expense. It may even be possible to deduct the whole cost of the computer in a single year.

If you work for someone else, but you purchase your own computer for work purposes, in most cases your employer will reimburse you. This happens because the employer can then deduct it as a business expense. However, if your employer doesn’t reimburse you, you’ll only be able to deduct the expense if it exceeds 2% of your adjusted gross income. If your AGI is $50,000, have to be greater than $1,000.

If you purchase a computer to use in your own business, you can deduct the entire cost of the expense. Typically, you should depreciate the cost over five years. However, business owners can deduct the full amount of the computer in a single tax year.

For example, an accountant works full time from a home office that is used exclusively for work. Because the offices qualifies for the home office deduction, if the accountant buys a $1,000 computer for his business, he can deduct the cost without having to show how or when he uses the computer. There is no need to prove the computer is used for business specifically.