write-off
Sign in to saveAlso known as write-offs, writeoff, writeoffs, write-down, write-downs
A write-off is a reduction of the recognized value of something. In accounting, this is a recognition of the reduced or zero value of an asset. In income tax statements, this is a reduction of taxable income, as a recognition of certain expenses required to produce the income.
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Encyclopedic overview
9 sectionsContents
- Income tax
- Accounting
- Banking
- Negative write-offs
- Write-down
- Criticism
- See also
- References
- External links
A write-off is a reduction of the recognized value of something. In accounting, this is a recognition of the reduced or zero value of an asset. In income tax statements, this is a reduction of taxable income, as a recognition of certain expenses required to produce the income.
==Income tax== In income tax calculation, a write-off is the itemized deduction of an item's value from a person's taxable income. Thus, if a person in the United States has a taxable income of $50,000 per year, a $100 telephone for business use would lower the taxable income to $49,900. If that person is in a 25% tax bracket, the tax due would be lowered by $25. Thus the net cost of the telephone is $75 instead of $100.
Excerpted from Wikipedia’s “write-off” article, available under the CC BY-SA 4.0 licence.