Tax liability

The purchase of property for business operations in 2025 is a significant event. However, the $200,000 cost itself does not directly reduce your tax liability dollar-for-dollar in the year of purchase. For tax purposes, the property's cost is generally recovered over time. The portion attributable to land is not depreciable. Any buildings or improvements on the property will be depreciated over their useful life, providing an annual deduction against income. Your overall tax liability depends on many factors, including your LLC's net income (revenue minus all allowable expenses, including depreciation), the specific classification of your LLC for federal tax purposes (e.g., disregarded entity, partnership, S-corp), and other potential deductions or credits. State-specific taxes in Connecticut also play a role. Without a comprehensive review of your business's full financial picture, including all income and expenses, and understanding your entity's tax election, it