SHST, routine maintenance, de minimis example

[Erik Kubec]

Hello BP folks,

Here is a real scenario for one of my properties with regard to how to use the Safe Harbor for Small Taxpayers, Routine Maintenance, and/or De Minimis options.

Property LCT has an original basis (just the building) of $70,000

Here is the work performed on the property during 2016:

1) The following done as part of a make-ready/turn over.  None of these seemed to improve the property, but rather to get it back to regular condition.  These seem to be types of expense that will regularly occur

• Paint interior walls, repair interior doors, drywall, tile
• Clean, clean, clean
• Repair plumbing, dishwasher from tenant damage
• Replace smoke alarms, blinds
• Replace weather seal

2) These items below are to fix damage the tenant did.  These aren't likely to be repeated regularly, but they were damage, so repairing them gets the property back to the condition when the tenant moved in, but does not seem to improve it

• Repair electrical lighting in garage from tenant damage
• Repair exterior door to garage from tenant damage

3) Finally , I made an improvement to the property that did increase the thermal efficiency:

• Insulation of crawl space

Given the low basis and high cost of all the above, the SHST budget of 2% of 70,000 is blown, so I can't use that one

Can I do all of these things:

• For 3) (insulation) I paid a contractor $2400, which included materials.  Can I use the $2500 deminis for this?
• For 1) use Routine Maintenance Safe Harbor
• For 2) can I use two additional, separately invoiced de minimis ($800 for the door, $100 for the electric fixture?)