Understanding Company Assets

You might think assets are only relevant for large corporations, but in reality, almost every small business owns assets. Tools, equipment, vehicles, specialized software, and even a company website can be classified as business assets.

Why is this important? Assets play a key role in managing your company’s income and, in turn, your tax liability.

The primary way to leverage assets for tax purposes is through depreciation (distinct from amortization, which applies to intangible assets). There are several methods of depreciation that allow you to deduct the cost of assets over time. Whether your goal is to reduce taxable income, retain more income (for example, if you’re preparing to qualify for a mortgage), or spread the expense over multiple years, understanding how to properly depreciate assets can help you achieve it.

One of the most commonly overlooked opportunities involves personal items transferred to business use. Many small business owners start by using personal tools, equipment, or office technology for their company, but then forget that these items become business assets and are eligible for depreciation. Missing this step means losing a valuable deduction and potentially paying more in taxes. Don’t let this happen to you!

If you have questions about asset depreciation or any other business tax matters, I’d be happy to help. Schedule a consultation here: https://calendly.com/taxservicesllc