What does "write-off" mean?

Question

I've heard this term throughout my life but I've never been entirely sure exactly what it means or why you would want to write something off.

Answer 1

It means to expense, to 'write off' against equity or income, to 'charge-off', to eliminate as an asset and take a reduction in the equity accounts of the enterprise, to take a tax deduction if allowable, to recognize a loss, clear?

Answer 2

It just means to treat something as an expense. For a very simple example, let's say your business made $1,000 in sales for the year. If your only expense for the year was $400 of supplies that you 'write-off' then your net profit is $600.

Sometimes people refer to a write-off when they are expensing something through their business that they actually bought for personal use, which is not allowed under IRS regulations.