Recapture Agreement

Return costs: Applicants must pay all reconquest fees prior to granting an authorization in accordance with the current Reconquest Agreement. Depreciation is regained when the equipment is sold winning. If the equipment is sold after four years for 3,000 $US, the company has a taxable profit of US$3,000 to US$2,000 = US$1,000 $US. It is easy to believe that a loss arose from the sale, since the asset was bought for 10,000 $US and sold for only 3,000 $US. However, profits and losses are realized on an adjusted cost basis, not on an initial cost basis. In this case, the company must declare a regained profit of 1,000 $US. When a business is required to add a deduction or credit from a previous year to income, it is reconquered. .

Please contact the office if you require a paper copy of any of these documents.

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