I have a tax question about how to claim depreciation. How does the depreciation deduction affect itemizing deductions?
When you claim depreciation, your itemized deductions should not be affected if you are either of these:
- Sole proprietor
This applies whether you itemize on Schedule A or claim the standard deduction.
If you’re a sole proprietor, report your depreciation deduction as a trade or business expense. Report it on your Schedule C.
If you’re a farmer, use Schedule F.
You’ll claim depreciation as an itemized deduction if both of these apply:
- You’re an employee.
- You’re claiming depreciation as an unreimbursed employee business expense.
You’ll use Schedule A to itemize. Your depreciation deduction is subject to the 2% of adjusted gross income (AGI) limit. So, use depreciation when deciding whether to itemize or claim the standard deduction.
Get more from your tax return and learn what tax deductions are available for home purchases with help from the tax experts at H&R Block.
Can you be claimed as a qualifying child or relative if you are 24 years old and live with your parents who primarily support you? Get tax answers fro
Wondering if you can file taxes with your maiden name? Learn how to file taxes jointly with different last names from the experts at H&R Block.
If you have self-employment income are you able to still claim the Earned Income Credit? Learn more from the EIC tax experts at H&R Block.