Originally Posted by lamelde
So... talking about the start up costs. I invested my inheritance into my "business" how much of the little stuff can I write off? Or does it ALL have to be added together & depreciated? One example - the plastic feed & water er's - individually they are $3 - totally they were $60 - is there a certain $ amount it has to go over to be depreciated (or stay under to be expensed)?
I'm no CPA but I understand that there is different types of depreciation for a farm business. A building can be depreciated over say 30 years if it is a permanent structure or 15, 7 or even 3 years depending on cost and size. All the building & fencing expenses for the start up would be included and the date it went into use would be reported. Purchase of chicks, hatching eggs and how many hatched are recorded along with any losses. Receipts for small stuff like feeders, waterers, heaters for waterers in winter, brooder lights, brooders etc would be put on Schedule F as equipment and some can be grouped, I think - reguardless it would have a short depreciation like <3 years but, I leave that to my CPA to figure out. You need to keep receipts and record of everything. Feed, bedding, egg cartons, electric use and other expenses need to be recorded too - for write off. All your sales have to be reported as income. If you want the IRS to see this as a business - You need to keep records like a business should. Have a Business Plan that you can show the IRS for projected loss and profit so if, you get audited you are not seen as a hobby and penalized.