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Video instructions and help with filling out and completing Can Form 4797 Careers

Instructions and Help about Can Form 4797 Careers

Hello in this lecture we're going to talk about depreciation recapture and how it can affect a business at the end of this we will be able to explain what depreciation recapture is discuss potential tax effects of the depreciation recapture and pran example to illustrate depreciation recapture as always you want to seek advice from a professional when thinking about the depreciation recapture and how it can affect a business we will be looking at a scenario cure in order to see the effects of the depreciation recapture we're not going to get into specific code sections we're going to give the general idea of what depreciation recapture is how it comes about why the IRS would be justified to do it and what the potential tax effects would be in general in order to do that we're going to sell this piece of equipment here this being equipment supposed to look kind of like a dr. Seuss type of equipment where the raw material goes in here and we make widgets over here but in any case we're gonna sell this piece of equipment in order to see how this would be affected how the depreciation recapture could happen we want to go through the story of the equipment meaning we want to start with a purchase of the equipment record the life of the equipment and then to the sale of the equipment so before we sell this we're going to record the purchase of it and go through this process so when we purchase the equipment we're gonna say we purchase it for 500,000 so if we looked at our books here 500,000 would be credited when we purchased it and we put it on the books for the 500,000 of that being the fair market...

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