Thank you DianeW777 for your comprehensive and detailed response. Here are a couple of followup comments and questions:
- If I am reading the Safe Harbor for Small Taxpayers correctly, there is no $2,500 limit for a building improvement to be expensed under the Safe Harbor for Small Taxpayers as long as we meet the three rules, including the last one about the total amount of repairs and improvements not exceeding the lesser of $10,000 or 2% of the unadjusted basis of the property. Correct?
- If a property does not meet the De Minimis Safe Harbor Election requirements, and an improvement is $200 or less, is it better to expense the improvement under the Safe Harbor for Small Taxpayers (the property meets the requirements) or expense it because it is $200 or less?
- In Turbo Tax, Turbo Tax uses the terms "Item" and "Improvement". From your and JulieS's responses, am deducing that Item = Personal Property and Improvement = an improvement to Real Property. Am I correct?
Thanks, Think57
