Storage Unit

Forum|Forum|1 year ago
November 18, 2024
2 replies
34 views

Taxpayer owns a storage unit (sch C)

He added a new building to it to hold more units

The cost of the building was $46,671. Taxpayer put down a deposit of in March of $5,500. He paid the remaining balance in June.

What is the best way to take this write off or correct way?

Thank you for your help...

ProSeries Professional

This topic has been closed for replies.

Best answer by IRonMaN

You start depreciating the asset once it is actually put into use.

IRonMaNAnswer

Level 15

You start depreciating the asset once it is actually put into use.

Slava Ukraini!

MGC94Author

Level 7

@IRonMaN J1 - 39/40 nonresidential/commercial real estate?

IRonMaN

Level 15

Yes

Slava Ukraini!

BobKamman

Level 15

1) You start depreciation when it is available for use.

2) Storage units can qualify as “tangible personal property” under the U.S. tax code because they are considered movable and not permanently attached to the land. This classification allows self-storage facilities to benefit from a shorter depreciation schedule. Instead of depreciating assets over the standard 39-year class life for commercial buildings, storage units can be depreciated over just seven years, resulting in significant tax savings.

https://engineeredtaxservices.com/capitalize-on-tax-planning-opportunities-in-self-storage-industry/

IRonMaN

Level 15

The storage units in my neck of the woods consist of buildings anchored to a concrete slab so they aren't very movable.

Slava Ukraini!

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