How do I enter real estate assets (appliances) purchased and destroyed (by shoddy contractors) in 2021?

[thuyh1121]

I purchased a dishwasher for my rental property in 2021. It was damaged in delivery or installation, and it wasn't salvageable. Presumably I can count this loss among my real estate losses? How do I record its destruction to TurboTax to make this correct?

[MinhT1 · Accepted solution]

if your dishwasher costs less than $2,500, the best and easiest solution would be to make the de minimis safe harbor election and expense it.

You will no longer have to account for it.

Please read this IRS document about the de minimis safe harbor election.

[thuyh1121]

Awesome! And thanks for the link!

Do you happen to know how to enter the de minimis safe harbor election in Turbotax? 

[AnnetteB6]

You will find the de minimis safe harbor election questions in the Assets section of the Rental Income and Expenses portion of your return.  

@thuyh1121

[thuyh1121]

Sorry, one more question:

When entering my de minimis expenses in Turbotax, it says to put them in the Miscellaneous section:
- Should I add everything together or itemize them?

- Does the de minimis election apply to repairs/maintenance or just improvements and purchases? If so, should I be taking things out of those sections and putting them in the miscellaneous section?

Thanks so much!

[ThomasM125]

You can lump all of your de minimis expenses together and called them as such.

Repairs and maintenance expenses are deductible without an election. There is a category on schedule C for them. You need the election for improvements and asset purchases or you can set them up for depreciation. They are distinguished from repairs in that they improve the value of the property or extend it's normal useful life.