I am displaying my ignorance but I am totally confused about this issue. I was hoping that TTB would shed some light on this but it doesn't. I am aware that this only happened recently.
The main question is: Does this regulation in any way effect the depreciation system we have always used?
F.e. Using these regulations, a taxpayer can elect to not capitalize all assets costing $500 or less (I am not referring to the 179 election). BUT this also constitutes a change in accounting method. Will a taxpayer have to follow this regulation to be able to expense any asset, even a low cost calculator? Again, don't bring Sec.179 into this picture.
Does anything change in regards to deducting repairs on a building, see quote below:
"A significant change for small taxpayers is that taxpayers with gross receipts of $10 million or less can elect to deduct, for buildings that initially cost $1 million or less, the lesser of $10,000 or 2% of the adjusted basis of the property for repairs, etc. each year."
Again, change in accounting method required. My real question is, should a taxpayer adopt these regulations to not run into arguments with the IRS what is deductible as repairs?
Please, someone tell me, that I am totally going overboard, and nothing really changed for the type of clients I am normally dealing with. I do have a client whose apartments complexes cost several million dollars, and I am concerned about possible bookkeeping consequences.
The main question is: Does this regulation in any way effect the depreciation system we have always used?
F.e. Using these regulations, a taxpayer can elect to not capitalize all assets costing $500 or less (I am not referring to the 179 election). BUT this also constitutes a change in accounting method. Will a taxpayer have to follow this regulation to be able to expense any asset, even a low cost calculator? Again, don't bring Sec.179 into this picture.
Does anything change in regards to deducting repairs on a building, see quote below:
"A significant change for small taxpayers is that taxpayers with gross receipts of $10 million or less can elect to deduct, for buildings that initially cost $1 million or less, the lesser of $10,000 or 2% of the adjusted basis of the property for repairs, etc. each year."
Again, change in accounting method required. My real question is, should a taxpayer adopt these regulations to not run into arguments with the IRS what is deductible as repairs?
Please, someone tell me, that I am totally going overboard, and nothing really changed for the type of clients I am normally dealing with. I do have a client whose apartments complexes cost several million dollars, and I am concerned about possible bookkeeping consequences.
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