I did minor remodelling to a kitchen and bathroom. Total cost ~$1500. I want to take the De minimis Safe Harbor Election election on this expense.
First, when entering the asset in TT there's not a good fit:
- Residential Rental Real Estate: only allows straight line depreciation over 27.5yrs
- Appliances, carpet, furniture: Allows the election, or apparently does but the 'asset' isn't one of these
- Land Improvements - clearly not his!
First question: where do I put this?
Next, if it's under 'appliances, carpet, furniture' eventually I get the 'how do you want to deduct this item?' question. If I choose the second option, 'I'll deduct the full value of the item this year' my net income for the rental reduces by a small amount (few dollars) only. If I choose 'I'll take the 100% special depreciation allowance' the income reduces by the full amount (like that one)... but TT says this option is available 'only if the original use of the property begins with you'. What on earth does that mean? Which can I choose here?
Thanks in advance.
