The water heater meets the criteria to be fully expensed this year under the DeMinimis Safe Harbor election. The HVAC becomes a little more complicated because it would be considered a capital improvment. Below is the example of the capital improvement rules for DeMinimis Safe Harbor.
You will add the water heater to the "other" expense of your rental expense section. Simply add the expense there and you can use "DeMinimis Safe Harbor" as the description. Maintain a list of the expenses you are including in this figure with your tax return records.
Record these as other expenses in TurboTax Premier as follows:
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Tax Tools > Tools > Topic Search > Type rental expenses > Go
- Continue to Rental Summary and Update your Expenses
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Click the screenshots attached to enlarge and view for assistance.
Here are the rules you need to meet to take this election for capital improvements:
- Your gross receipts, including all your other income, are $10,000,000 or less.
- Your eligible building has an unadjusted basis of $1,000,000 or less.
- 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
A detailed explanation of both is included below.
https://ttlc.intuit.com/replies/4682171
