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Returning Member
posted Apr 1, 2020 11:16:53 AM

I as a S-Corp leased a building for a new business. There were a number of expenses in 2019 remodeling it to meet our needs. What can I expense in 2019 does anything ne

I as a S-Corp leased a building for a new business. There were a number of expenses in 2019 remodeling it to meet our needs. What can I expense in 2019 does anything ne

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1 Best answer
Expert Alumni
Apr 1, 2020 11:52:05 AM

The costs are called leasehold improvements.

 

There are 3 ways you can treat them taxwise depending on their nature and cost:

 

1. You can take a 179 deduction and expense 100% of their cost. Please see this IRS document.

2. They can be capitalized and depreciated over 15 years.

3. If their unit cost is $2,500 or less, you can claim them as business expenses if you make the de minimis safe harbor election.

1 Replies
Expert Alumni
Apr 1, 2020 11:52:05 AM

The costs are called leasehold improvements.

 

There are 3 ways you can treat them taxwise depending on their nature and cost:

 

1. You can take a 179 deduction and expense 100% of their cost. Please see this IRS document.

2. They can be capitalized and depreciated over 15 years.

3. If their unit cost is $2,500 or less, you can claim them as business expenses if you make the de minimis safe harbor election.