What Do I Need To Provide My Accountant?
In order to determine depreciation on your business assets, your accountant or CPA will need to know:
- The date the asset was "placed in service" or first used in your business.
- The cost basis of that asset, including purchase price, costs for shipping and setup and installation.
For every long-term asset in your business, you must have a record showing when you purchased it, when you started using it, purchase price and other purchase costs, and when you sold the asset. Keeping track of depreciation can help you reduce your tax liability, so it is important to keep track of these records.
What Tax Form is Used for Depreciation and Amortization?
IRS Form 4562 is used to show depreciation for depreciable property which is placed in service during that tax year. Partnerships and Limited Liability Companies also use Form 4562 to claim depreciation on a car.
Section 179 deductions are also claimed on this form.
S Corporations use Form 4562 to claim depreciation for property placed in cervice for the current year, or for cars used for business purposes. C Corporations use Form 4562 for all depreciation deductions.
