Repair vs Depreciation

[S T]

At t/p business property there was a major plumbing repair, the parking lot at the business location was totally destroyed and had to be redone. We are talking in the $20,000 range.

Since it was not an improvement, but a repair issue, can it be expensed, or due to the amount of the expense will I have to depreciate.

Thanks

Sandy

[JoshinNC]

depends on the purpose for the expenditure

and whether the useful life of the structure was extended. I would look at the underlying purpose for the expenditure and make a determination using that criteria.

[S T]

Underlying

Underlying was definitely a repair, but the parking lot is now improved since it is newer. This is also a leasehold and the t/p was responsible for the repairs as per the lease.

Sandy

[veritas]

Persoanlly I would definitely lean towards a current expense.

[Brian EA]

At t/p business property there was a major plumbing repair, the parking lot at the business location was totally destroyed and had to be redone. We are talking in the $20,000 range.

Since it was not an improvement, but a repair issue, can it be expensed, or due to the amount of the expense will I have to depreciate.

Thanks

Sandy

What about expensing the plumbing repairs and depreciating the parking lot.

[OldJack]

I would lean toward expensing the plumbing and the parking lot as repairs. However, I would take into account the prior condition of the parking lot and if it was really necessary to redo the entire parking lot for the repair. Its a facts and circumstances for the parking lot.