How Does the Amortization of Hardware Costs Affect a Miner’s Tax Liability?

Amortization, or more accurately, depreciation for tangible assets like mining hardware, allows a miner to deduct the cost of the hardware over its useful life. This deduction reduces the miner's taxable income, lowering their overall tax liability.

The method of depreciation (e.g. accelerated depreciation) can significantly impact the timing of these deductions, which is a key tax planning strategy.