When can I show an expense for a farm shop building paid for in 2022 but not completed until 2023?

[Joe3154]

Began the farm in 2022 (already had the land).  Contracted a shop to be built on our farm. Put a $5k deposit in Sept 2022, Paid $25k for materials delivered in Dec 2022, Paid $10k to builder after framing/siding shop in Jan 2023, and finally paid $12k for concrete work in Feb 2023.  Shop did not get used until Feb 2023.  Paid directly from me (no loans).

Am I right in thinking that I cannot claim any of this expense for 2022 taxes but should claim it all on next year's (2023) taxes? 

I tried to enter as an asset but TT would not accept due to date that building was put into service.  Just seems to go against my instinct to claim expenses in the tax year in which they were paid.

Thank you again.

[tagteam · Accepted solution]

---

@Joe3154 wrote:

Am I right in thinking that I cannot claim any of this expense for 2022 taxes but should claim it all on next year's (2023) taxes? 

---

Yes. If you placed the shop building into service in the 2023 tax year, then depreciation will start in the 2023 tax year (in the month you placed the building into service).

[Mike9241]

depreciation doesn't start until the year you place the asset into service which seems to be 2023. it is not possible to enter 2023 items in 2022 Turbotax.  keep good records not only for Turbotax but in case the IRS ever makes an inquiry.