Is office furniture an asset?
Office furniture is typically classified as a fixed asset rather than a regular business expense. Because furniture provides long-term value and is used over several years, it’s recorded on the balance sheet as an asset and depreciated gradually for accounting and tax purposes.
What is office furniture?
Office furniture includes items such as desks, chairs, tables, shelving, and other furnishings used in daily business operations. These assets contribute to the company’s workspace and efficiency over time rather than being consumed immediately. For that reason, they’re capitalized and depreciated instead of expensed in full during the year of purchase.
How to categorize office furniture
- Record as a Fixed Asset on your balance sheet, not as an operating expense.
- Use an “Office Furniture and Equipment” or “Fixed Assets” account in your chart of accounts.
- Capitalize purchases that meet your company’s asset threshold (commonly $2,500 or more).
- For lower-cost items below your capitalization limit, record them as Office Supplies or Small Equipment Expenses.
- Apply depreciation over the furniture’s useful life (typically 5–7 years).
- Maintain records of purchase dates, costs, and serial numbers for depreciation tracking.
Examples of office furniture
- Desks, tables, and conference room furniture.
- Office chairs and ergonomic seating.
- Filing cabinets, shelving units, and storage systems.
- Reception furniture or waiting area seating.
- Modular workstations and cubicle setups.
- Breakroom or kitchen furniture.
Tax implications for office furniture
- Office furniture is considered a capital asset and must be depreciated over its useful life.
- Businesses may use Section 179 or bonus depreciation to deduct all or part of the cost in the year of purchase.
- Only assets used more than 50% for business purposes are eligible for accelerated depreciation.
- Furniture purchased with mixed personal use should be depreciated only for the business-use portion.
- Keep receipts and depreciation schedules as documentation for your tax filings.
- Repairs or minor refurbishments to existing furniture can typically be expensed immediately.
