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.
What does it mean to be an enrolled agent? Learn more about the roles and requirements of enrolled agent (EA) tax preparers at H&R Block.
Trying to determine the cost of tax preparation or H&R Block’s prices? Find out why there is no one-size-fits-all answer when it comes to tax prep.
If you need help handling an estate, we're here to help. Learn how to file taxes for a deceased loved one with H&R Block.
What’s the difference between an enrolled agent (EA) vs. a certified public accountant (CPA)? Explore the roles of EAs and CPAs at H&R Block.