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Is sales tax paid for business equipment capitalized or depreciated?

In: Taxes and Tax Preparation, Business Accounting and Bookkeeping, Sales Tax [Edit categories]

Answer:

Normally, purchases for supplies and equipment used in the business (not for re-sale) are subject to sales tax. Could vary by state.

Answer

I think you meant to ask if the sales tax was expensed or capitalized. Any sales tax paid on equipment is considered to be part of the cost of the asset. Therefore its both capitalized and depreciated.

First answer by Taxref. Last edit by Taxref. Contributor trust: 39 [recommend contributor ]. Question popularity: 15 [recommend question].

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