It can be confusing like many IRS tax laws. The hot water tank will definitely qualify, you can see if the HVAC qualifies below.
There are two separate options under Safe Harbor.
- Safe Harbor Election for Small Taxpayers - For the HVAC -
- Special requirements - The cost of all repairs, maintenance and improvements is less than or equal to the smallest of these limits:
- 2% of the unadjusted basis of your building or
- $10,000
- Safe Harbor for items that each cost $2,500 or less - Available for the hot water tank
@andre_arrieta
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