If you qualify for the Safe Harbor Election for Small Taxpayers, the deduction is limited to two percent of the adjusted basis of your building or $10,000 maximum. Be sure you are selecting the corre...
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If you qualify for the Safe Harbor Election for Small Taxpayers, the deduction is limited to two percent of the adjusted basis of your building or $10,000 maximum. Be sure you are selecting the correct election (see more below).
Per the IRS, the requirements of the safe harbor election for small taxpayers are:
Average annual gross receipts of $10 million or less; and
Owns or leases building property with an unadjusted basis of less than $1 million or less; and
The total amount paid during the taxable year for repairs, maintenance, improvements, or similar activities performed on such building property doesn't exceed the lesser of-
Two percent of the unadjusted basis of the eligible building property; or
$10,000 (for questions about how to calculate the unadjusted basis, refer to "Figuring the Unadjusted Basis of Your Property" in Publication 946.
This Safe Harbor Election is separate from the De Minimis Safe Harbor election for assets that lets you deduct the full cost of items worth $2,500 or less, instead of depreciating.
For more info, see What can I expense or depreciate with the new business safe harbor election?