At What Point is it a Business Expense?

2 Replies

I am moving out of my residence and will be renting it out.  The dishwasher died, and I'd like to be able to treat the replacement as a business expense and get the tax advantage.  I don't mind washing dishes by hand for a while, so at what point should I replace the dishwasher?  Do I need to wait until I physically move out?  Or can I do it once I advertise the unit for rent?  Or some other option?

Similarly, the unit needs some painting done and I'd like to know the best timing for that.

@Barri F. .

The following elements must be proved before it is considered placed in service:

  • 1) Readiness.
  • 2) Availability.
  • 3) Capability to perform its intended function.

Advertising it before actually moving out does not meet the availability requirement, and the house is also not ready to rent.

So, if you don't mind washing by the hands, looks like you would be better off until you move out. 

(Since you are living in it, I am assuming the house is in decent condition and does not significant improvements to make it ready to perform its intended function). Once you move out and is advertised, all the repairs  ( painting ) and buying appliances that are below 2500 can be expensed.  Even if its above 2500, you might be able to fully deduct it under 100% bonus depreciation with new tax reform. 

Good luck.

@Ashish Acharya thank you for the info.  Looks like I will be washing dishes by hand until I move out.  *sigh*

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