According to the IRS safe harbor instructions, Section 162 of the Internal Revenue Code (IRC) allows you to deduct all the ordinary and necessary expenses you incur during the taxable year in carrying on your trade or business, including the costs of certain materials, supplies, repairs, and maintenance. Under the Safe Harbor provision, these costs can be expensed if under $2500.
However, section 263(a) of the IRC requires you to capitalize the costs of acquiring, producing, and improving tangible property, regardless of the size or the cost incurred. This would include a HVAC.
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@dankrall
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