I live next to farmers. Everything they do and own is a business expense. The business owns everything. Home, cars, utv, electric, propane, internet, new land, gas, desiel, and red desiel. They go on multiple caribbean vacations, rent out the banquet room and claim it as a business expense. Is this really what business are able to do?
In: Economics
The important thing here is that the tax code is set up to tax PROFIT and not REVENUE. So if you sell 100 chairs at $100 each, that’s $10,000 but the cost of the lumber is $50 per chair, then you get to deduct $5000 from that 10,000. Then you get to depreciate the cost of the machines used over its useful life. So if you buy a $1000 saw you can deduct $100/yr for 10 years (assuming that is the useful life)
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