Assets are the property, such as machinery and furniture, that you own and use in your business. You must keep records to verify certain information about your business assets. You need records to figure the annual depreciation and the gain or loss when you sell the assets. Your records should show the following information.
When and how you acquired the asset.
Purchase price.
Cost of any improvements.
Section 179 deduction taken.
Deductions taken for depreciation.
Deductions taken for casualty losses, such as losses resulting from fires or storms.
How you used the asset.
When and how you disposed of the asset.
Selling price.
Expenses of sale.
The following documents may show this information.
Purchase and sales invoices.
Real estate closing statements.
Canceled checks.
Information courtesy of the Internal Revenue Service.
