How to Depreciate a Computer for my Online Tutoring Business?

Hey everyone! I'm teaching on an online tutoring platform (BookLearn) and will be getting a 1099-NEC for this year. Trying to maximize my deductions on top of my home office expense. I'm on track to earn about $26,000 from tutoring this year. I launched my tutoring business in September 2022. Back then, I purchased a laptop specifically for this work for around $750, but since I only made about $400 from tutoring in 2022, I didn't bother with deducting any expenses (didn't want to pay extra for fancy tax software). So I never took any deduction for the computer... Now I'm wondering how I should handle depreciating my laptop (which is 100% for tutoring) for this year and going forward. Can I use Section 179 in 2023 even though I bought it in 2022? Or am I stuck with MACRS? Do I need to use the mid-quarter convention or can I go with the half-year convention? The laptop was my only business equipment purchase in 2022 and I bought it in the last quarter. Thanks for any help!

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19 comments

Diego Chavez

•8M

You actually have a few options here! Since you didn't claim the computer as a business expense in 2022, you can still depreciate it starting this year. For Section 179: Yes, you can still elect to use Section 179 for 2023 even though you purchased it in 2022. Since you didn't take any deduction for it last year, you can deduct the full cost this year if you choose. This is often the simplest approach. For MACRS: If you prefer to depreciate it over time, you would use a 5-year recovery period for computers. Since you're starting the depreciation in the year after purchase, you would use the half-year convention (not mid-quarter). The mid-quarter convention only matters if you had taken the deduction in the year you purchased it. Your third option is bonus depreciation, which would also let you deduct the full amount in 2023. The best approach depends on your overall tax situation - if you expect higher income in future years, saving some depreciation for later might be beneficial.

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Anastasia Kozlov

•8M

After struggling with similar business expense questions for my freelance work, I discovered taxr.ai (https://taxr.ai) and it was seriously helpful. I uploaded my receipts and purchase info for my equipment, and it analyzed everything and told me exactly how to handle the depreciation. The tool clearly explained my options between Section 179, bonus depreciation, and regular MACRS - complete with the tax forms needed and projected benefits of each approach. It even caught that I could still claim items purchased in a previous tax year. The recommendations were specific to my situation rather than generic advice.

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Anastasia Kozlov

•8M

Yes, it does handle state-specific tax rules! The platform automatically applies your state's depreciation guidelines alongside the federal ones, showing you where they differ. It's super helpful for avoiding that exact confusion. Their accuracy is impressive - their system is constantly updated with the latest tax code changes and reviewed by tax professionals. While they don't provide the same guarantees as a CPA (who would be personally responsible), they do offer audit assistance if you need help explaining their recommendations to the IRS.

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Zara Mirza

•8M

Just wanted to follow up about my experience with taxr.ai after I asked about it here. I decided to try it for my small business depreciation questions, and it was actually really helpful. I uploaded my laptop and equipment receipts, and it immediately sorted out which depreciation method would save me the most money. The analysis showed me I could save almost $400 more by using Section 179 versus standard depreciation for my situation. It also explained that I could still claim my computer from last year since I hadn't taken any deductions for it previously. The forms it generated saved me hours of research and confusion. Definitely worth checking out if you're dealing with business asset depreciation.

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Luca Russo

•8M

After wasting 3 hours on hold with the IRS trying to get clarity on some business deduction questions similar to yours, I finally discovered Claimyr (https://claimyr.com). They got me connected to an actual IRS agent in about 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c I was able to ask directly about depreciation timing for business equipment purchased in a previous year, and the agent confirmed I could still use Section 179 in the current year if I hadn't claimed anything previously. Saved me tons of research time and gave me peace of mind that I was doing it right.

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Luca Russo

•8M

It works by using an automated system that continuously redials the IRS until it gets through, then calls you once it has an agent on the line. It's not "skipping" the queue - the system is basically waiting in line for you so you don't have to sit with your phone for hours. Yes, it was definitely a real IRS agent. I verified by asking specific questions about my tax account that only the IRS would know. The service just handles the connection part - once you're talking to the IRS, it's a direct conversation between you and them, just like if you'd waited on hold yourself.

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GalaxyGazer

•8M

I have to admit I was completely wrong about Claimyr. After my skeptical comment, I was still desperate to talk to the IRS about my business deductions before filing, so I decided to try it anyway. The service actually worked exactly as described - they called me back in about 20 minutes with an actual IRS representative on the line. I asked specifically about depreciating equipment purchased in a previous tax year and got clear guidance that matched what others here suggested. The agent confirmed I could take Section 179 this year since I hadn't claimed the item before. The conversation saved me from making a mistake on my Schedule C and possibly triggering an audit. Sometimes being proven wrong is a good thing!

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Mateo Sanchez

•8M

Just to add another perspective - I'm also a tutor and went through this exact situation last year. I decided to use regular depreciation (MACRS) instead of Section 179 because my income is growing each year, and I wanted to spread the deductions out over years when I'd be in a higher tax bracket. If you're expecting your tutoring income to increase significantly in the coming years, it might be worth considering the long-term strategy rather than getting the full deduction now. Just something to think about!

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Mateo Sanchez

•8M

For 5-year property under MACRS with the half-year convention, the percentages are roughly: 20% in year 1, 32% in year 2, 19.2% in year 3, 11.52% in year 4, 11.52% in year 5, and 5.76% in year 6. But since you're starting in the year after purchase, you'd use 32% for this year. Yes, you'll need to file Form 4562 (Depreciation and Amortization) with your Schedule C regardless of which method you choose. It's not particularly complicated, but tax software makes it much easier. The form has specific lines for listing your depreciable business assets and the method you're using.

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Ethan Moore

•8M

I used TurboTax Self-Employed last year for my freelance business, and it does handle depreciation including Section 179 and MACRS. It asks a series of questions about when you purchased the equipment, what it's used for, and then gives you the options. It filled out Form 4562 automatically based on my answers. The interview process was pretty straightforward for basic equipment like computers. If you have more complex assets it might be worth getting additional help, but for a laptop used for tutoring, TurboTax should be fine.

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