Hello. I rent out one room in my primary residence and I plan (hope) to take the de minimis safe harbor election on my 2020 taxes for several expenses (e.g. replacing a broken refrigerator for $2,000). I plan to claim the items at 10% of cost since that is my calculated rental percentage.
Two questions:
1. Is the refrigerator considered “personal use” since I also live in the home and use it? Or have I “used this item 100% of the time for this business” since the fridge has been used by my renter since i purchased it, and therefore I can claim the $200 DMSH election?
2. (If the answer to Q1 is “business use”): I plan to discontinue renting the room at the end of 2021 and take it out of service, converting it back to solely my primary residence. Will there be any tax implications for taking the de minimis safe harbor election for the fridge in 2020 (purchased 8/10/2020), then converting it to personal use 1/01/2022?
Thank you!
