Tax deductions under the de minimis rule

[Chris Gilbert]

We replaced the deck on our rental house in 2016, but to make a long story short, we made a number of individual payments for various parts of the deck.  We made payments for various materials, labor for different parts, and so on.  We had a few large invoices, but several that were well under $2500.  Would the smaller invoices under $2500 qualify to expense those under the de minimis rule or should those all be totaled together for the deck improvement and depreciated?

[Brandon Hall]

@Chris Gilbert unfortunately it sounds like the cost to build the deck will need to be capitalized.

There is an "anti-abuse" clause to the De Minimis Safe Harbor. Essentially, we have to aggregate all costs related to the same unit of property. So if you spent $1,000 on materials, $1,000 on labor, and $1,000 on sanding and finishing, we'd aggregate all three of those costs and capitalize as the aggregate amount is above $2500.