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Your client, Ruth Rosenbaum, recently bought a new building for her business. Before she could put...

Your client, Ruth Rosenbaum, recently bought a new building for her business. Before she could put it into service, she had to pay for $3,000 of work to be done on the roof. How should she treat these expenses for tax purposes? Find relevant authority, and then determine what additional facts might be required.

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Answer #1

$3000 spent by Ruth Rosenbaum are the expense for building improvement which adds to the value of the property and hence these are added to the BUSINESS ASSETS/DEPRECIATION and will get depreciated overtime.

The additional facts that might be required are:

  1. The improvement must become A MATERIAL PART OF THE PROPERTY.
  2. The improvement must add real value to the property
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