How do I claim cash purchases on my business taxes?
I just started my welding business in January 2007 and paid cash for all of my equipment. I'm not sure how to claim this. I haven't taken in any revenue on this business yet, and am still in the set up process.
Get the working capital your business needs from Entrepreneur Lending, powered by CAN Capital. Learn More »Purchasing large dollar equipment (over $500) will be categorized as the purchase of an asset. If the cash came from personal funds, then the offsetting entry to assets will be either a loan to the company from you or as an equity investment. The best thing to do is visit with your business tax accountant to discuss the pros/cons of both options as it relates to your specific situation.