drogers
New Member

I rent a storefront in a shopping center for my business. The A/C had to be replaced last summer at my expense for $7,500. Can I deduct this as a maintenance expense?

 
AmyC
Expert Alumni

Investors & landlords

No, you can not deduct the air conditioning as a maintenance expense. The IRS uses a heating system as an example of a capital expense in its publication for business expenses. See Pub 535 for complete details.

 

 

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Carl
Level 15

Investors & landlords

For you, the new A/C is a leasehold property improvement. You must capitalize it and depreciate it over time.