Here's a breakdown based on your examples:
Carpet, Vinyl Flooring, New Toilet, New Vanity, New Tub: These items are typically considered assets because they are permanent improvements to the property that provide lasting benefits.
Plumber Labor for remodel: Labor costs for installation or repairs are generally categorized separately from materials. They are often classified as operating expenses or maintenance expenses rather than capital improvements (assets).
Washer/Dryer/Stove/Refrigerator: These are assets as they are considered durable goods that will benefit the property over an extended period.
New Baseboards/Trim, Doors: These are generally considered assets because they enhance the property's value and are not typically replaced frequently.
Furnace/AC: These are significant components of the property and are categorized as assets due to their long-term benefit.
Paint, Light Fixtures: These can be a bit nuanced. Generally, maintenance supplies like paint are categorized as supplies, while light fixtures can sometimes be categorized as assets if they are permanently installed.
Fencing, Lumber for deck remodel, Roof replacement: These are typically considered assets because they are substantial improvements to the property that enhance its value and longevity.
In terms of tax implications, categorizing expenses correctly can impact how they are treated for depreciation or immediate expensing under tax laws. Assets are typically depreciated over time, while supplies and maintenance expenses are deductible in the year they are incurred. Depreciation allows you to spread out the expense of assets over several years, reducing taxable income each year.
If you need further clarification, financing for your projects, or just have more questions please feel free to reach out to me directly.
