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DanKar73
Returning Member

De Minimus Safe Harbor election and Safe Harbor Election for Small Taxpayers with TT Premium 2019

Hope you can help me in this:

I'm using the premium version, my total repairs that i  entered under expenses is $4520, the 2% of the unadjusted basis of my building =$5600. 

I still have two separate receipts for improvement for my rental house ( changed the whole floor with Luxury Vinyl Plank),

one receipt is the material for $1900 and the other receipt is $2200 for the labor.

1.how can i enter them in De Minimus Safe Harbor election,Safe Harbor Election for Small Taxpayers?

2. can i enter both under "Did you buy any items for rental property  that cost $2,500 or less in 2019?"

or one under the this question and the second one under the "Did you make improvements to Second home that I rent out in 2019"

 

Please help me solving my issue

 

Thank you

3 Replies
VictorW9
Expert Alumni

De Minimus Safe Harbor election and Safe Harbor Election for Small Taxpayers with TT Premium 2019

You elect the De Minimis Safe Harbor election so that assets that cost $2,500 or less can be taken as an expense this year and don’t have to be depreciated over time. To do this, an annual election must be made.

 

The questions about this election appear at the beginning of the Assets/Depreciation section for Schedule C (Business) or Schedule E (Rentals). (see the TurboTax FAQ below for more details, and click on "For 2017, items $2,500 or less")

If you didn't expense any purchases that would be included under this election, you may go back and change your answers. You can also keep the election as there isn't any harm in doing so.

 

https://ttlc.intuit.com/replies/4682171

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DanKar73
Returning Member

De Minimus Safe Harbor election and Safe Harbor Election for Small Taxpayers with TT Premium 2019

Thank you VectorW9 for replying this fast but i think you didn't read my question details, i mentioned the exact situation im stuck in now..

i have 2 invoices with two amounts under $2500 ($1900 for material- Vinyl) and another one for the labor ($2200) and im not sure if  this will count also (i already entered expenses for repairs 4520)

the following expenses is for making enhancement (not repair)

can I enter 2 separate/individual items under De Minimis Safe Harbor election so that assets that cost $2,500? vinyl planks can be considered items i bought for enhancement.

can i enter the labor (the second receipt )under Safe Harbor Election for Small Taxpayers?

Irene2805
Expert Alumni

De Minimus Safe Harbor election and Safe Harbor Election for Small Taxpayers with TT Premium 2019

The IRS doesn't directly address the question you ask.  They state that if you don't have an Applicable Financial Statement (AFS), which most small business don't, "you may use the safe harbor to deduct amounts up to $2,500 per invoice or item (as substantiated by invoice)."  Tangible Property Regulations - Frequently Asked Questions

 

Since the IRS does not say you can't separate the two expenses, my advice is to go ahead and enter the two expenses separately.

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