Make sure repairs to tangible property were actually repairs before you deduct the cost

Make sure repairs to tangible property were actually repairs before you deduct the costRepairs to tangible property, such as buildings, machinery, equipment or vehicles, can provide businesses a valuable current tax deduction — as long as the so-called repairs weren’t actually “improvements.” The costs of incidental repairs and maintenance can be immediately expensed and deducted on the current year’s income tax return. But costs incurred to improve tangible property must be depreciated over a period of years.

Tangible property safe harbors help maximize deductions

Tangible property safe harbors help maximize deductionsIf last year your business made repairs to tangible property, such as buildings, machinery, equipment or vehicles, you may be eligible for a valuable deduction on your 2016 income tax return. But you must make sure they were truly “repairs,” and not actually “improvements.”