De Minimis Safe Harbor

[Erin N.]

I paid $30k for windows this year.  60 windows @ $250 each.  My invoice is itemized. Can I claim de minimis safe harbor since each window is less than $2500 and my invoice is itemized?  I didn't have to replace them all at once.  I could have replaced 1 at a time if I wanted to.  I think this might meet the test for them being separate items.  It's not like I purchased 6 cases of tile but then assembled them into a single floor or anything like that.  Anyway, not looking to do anything sketchy.  Just want to apply the safe harbor correctly.

Thanks.

[Ashish Acharya]

@Erin N., 

The concept of de minimis is complicated. You have to look at the Unit of Property -UOP that was improved.

Generally, for buildings, the building and it’s structural component(excluding key building systems-eg.HAVC) is a unit of property. 

Each window is not a separate UOP, the entire building and it’s structural  component is one UOP. 

As you replaced the all/majority of windows, the cost is improvements,not repairs. 

If it was repair, it would be deductible right away. 

Here, If the total improvements to the UOP were less than 2500, then you would qualify, but in your case it is 30k plus installation.

You have to capitalize and depreciate.