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Updated almost 8 years ago on . Most recent reply
De Minimis Safe Harbor and Safe Harbor for small taxpayers
I understand that the De Minimis Safe Harbor is for real properties that are less then $2500 each and Safe Harbor for small taxpayers is for improvements that are no more than 2% of the cost basic or $10K whichever is less.
Now let say I have remodeled my rental and the cost consisted of new floor $3000, new windows $3000 and new stove $2000, new fridge $2000, new washer $1000 and new washer $1000.
Assume that my rental's SHST amount is $6000. That means I can expense the new floor $3000 and the new windows $3000 under SHST. And I can also expense the stove, fridge, washer and dryer under DMSH.
Here is my question. Under which category of expense on my tax return I should put all these expenses. According to Turbox Tax, I should put all the SHST expense under repair and list out each item under Other Expenses for DMSH.
Is that the correct way to do it? If I have some small expenses under the maintenance category, will that count against my $6000 SHST limit? And If my DMSH expense consists of many small items that are under $2500 such as chairs, tables, sofa, rugs, blinds, curtains, do I really need to list out all of them under Other Expenses or can I lump sum them in one item and call it Living Room upgrade?
Thanks in advance.
John