After nearly a decade of issuing a long series of proposed and
temporary regulations, the IRS has finally issued final regulations
providing guidance to help taxpayers determine how to treat
expenditures related to tangible property from a tax perspective.
Such property includes buildings, machinery, equipment and
vehicles, as well as costs incurred to replace major components
or substantial structural parts of a unit of property (UOP). It
also includes costs that result in a UOP’s betterment, restoration
or change in use.
The final regulations (IRS T.D. 9636, also known as the Repair
Regs) help clear up the confusion that has existed for many years
with regard to whether taxpayers can expense and deduct repair
and maintenance costs, or if they must capitalize these expen
ditures. Property and costs that are expensed generally can be
deducted in the year they are paid or incurred, but those that are
capitalized must be...
Read the full article in The American Mold Builder | Winter 2015