Yes, you probably can expense at least some of your costs as routine maintenance.
To be considered routine maintenance your expenses need to meet these criteria:
- It is paid for recurring activities performed on tangible property.
- It arises from the use of the property in your trade or business.
- It keeps your property in an ordinary, efficient operating condition.
- You reasonably expect, at the time the property is placed in service, to perform this activity more than once during the 10-year period after you place the building in service; or more than once during the class life of the particular type of property.
For instance, refinishing a hardwood floor, or replacing carpet would meet this standard because you can expect to do it again after a few years of rental use.
You must capitalize the costs of making improvements if the improvements result in a betterment to the unit of property, restore the unit of property, or adapt the unit of property to a new or different use.
Some examples of improvements include rewiring or replumbing of a building, replacing an entire roof, and putting an addition on your building.
Click here to read the applicable section of Publication 535.
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