From: utzoo!decvax!duke!bcw
Newsgroups: net.taxes
Title: Re: Deduction questions... - (nf)
Article-I.D.: duke.2944
Posted: Tue Jan 25 18:35:23 1983
Received: Fri Jan 28 04:04:00 1983
References: mcnc.1492,uiucdcs.1373

From:	Bruce C. Wright @ Duke University
Re:	Computer depreciation

That's easy - if you are depreciating an item over a period of years, and
the depreciation period has not yet run out when you sell or otherwise
dispose of the item, then your "initial investment" cost is the UN-depreciated
cost (that is, the fraction not yet depreciated), and you must pay capital
gain tax if you sell the item for more (always the case if it has been
depreciated to 0 ...), or you may take a capital loss if you sell the item
for less.  This is true for anything, of course, not just computers;  but
the problem is that computer value drops somewhat faster than the depreciation
the government allows you ... leaving you usually with a capital loss to
claim.  Unfortunately, capital gains/losses are loaded towards capital gains,
i. e., you don't pay much tax on capital gains (relatively), but then you
don't get to deduct very much (relatively) on a capital loss (they are
handled differently from other types of losses where you can usually deduct
a larger share - maybe even all - of the loss in some circumstances).

			Bruce C. Wright @ Duke University