A taxpayer has a (very) small consulting software programming business. She uses a laptop with a purchase price of $1,500 and uses it solely for the business.
If she does section 179 first year expensing for the computer, what happens if in subsequent years there is no business activity?
Must there be a recapture of the Section 179 expense, or can she keep the business open and file a Schedule C reporting no income and no expenses (at least until the 5 year depreciation period for computers elapses)?
Are there other legitimate ways of avoiding the 179 recapture?
For example, what would happen if the taxpayer sells the computer at the straight-line depreciation value, and how is that reported?