business expense?

Question

i was told an art painting is fully deductable when purchased as long as it is going to be hung in the buisness for 9 months.
is that true?

Answer 1

Any business expense that is "reasonable and necessary" is deductible. Nobody expects a business to be totally devoid of any decorative enhancements so paying for artwork to hang on the walls often falls into the reasonable and necessary category.

The cost of artwork must bear some reasonable relationship to the type and size (income) of the business. A million-dollar artwork would be out of line in a Mom & Pop convenience store but may be entirely appropriate for the boardroom of a Fortune 50 corporation.

To be deductible as a business expense it would probably have to be on regular display though there is no specific period of time involved. If it were purchased and stored in a vault, the IRS would probably treat it as an investment in a collectible. Investments in collectibles are subject to special rules -- normally higher rates of tax from gains on sales, and little or no depreciation.

Answer 2

The IRS evaluates deductible for business expenses as ordinary and necessary.

The nine months is really extra information.

IF it is some million dollar art picture for the bathroom of a gas station......then no. Common sense comes into play here.

Answer 3

art painting is fully deductible as long as you treat it as a business. the best way to do this is to incorporate or use another legal entity.

if you want to find out specifically how you can reduce your tax burden, both legally and perpetually, you'll know where to find me.