Hello,
I purchased a metal building for my small business and paid a deposit in November 2023. The full price of the building was not paid until delivered in March 2024. How would I claim the deposit ($3000) for my 2023 taxes, or would I just claim the entire cost of the building in my 2024 taxes? The building is not in use yet and will be a separate structure on my residential property. In 2023, the business was more of a side hustle and will become more professional in 2024 (waiting on LLC paperwork). I appreciate any help or guidance. Thanks!
You do not deduct the cost of a building. A building is a depreciable asset. So, when you start using it, you will start depreciating the building. You will include the $3,000 along with whatever more you paid this year as the purchase price part of the cost basis.