I added culvert piping to yard to remove ditch at my rental property. Does that qualify as an expense or an improvement? If so, which, and how do I enter in Turbotax. There is a question in the Business Income and Expenses that references two election options (De Minimus Safe Harbor and Safe Harbor Election for Small Taxpayers), would this apply at all? My project cost $3700.
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The culvert likely counts as an improvement. Amounts paid are considered an improvement if it results in at least one of the following:
The expenditure may be expensed in the current year or may be capitalized to increase your basis to be reported at the time of sale.
In TurboTax Online Premium, follow these steps:
The De Minimis Safe Harbor Election lets you deduct the full cost of items worth $2,500 or less, instead of depreciating. Some portion of the expenditures which you outlined may qualify under this election.
The Safe Harbor Election for Small Taxpayers lets you deduct improvements costing above $2,500 as expenses this year instead of being depreciated over many years.
You can do this if:
Or you may elect to capitalize the costs by creating an improvement that is added to Your Property Assets. To do this select Add an asset and follow the directions on the screen.
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