IRS Raises Tangible Property Expensing Threshold to $2,500

IRS Raises Tangible Property Expensing Threshold to $2,500

The Internal Revenue Service has simplified the paperwork and recordkeeping requirements for small businesses by raising from $500 to $2,500 the safe harbor threshold for deducting certain capital items. The change affects businesses that do not maintain an audited financial statement. It applies to amounts spent to acquire, produce or improve tangible property that would normally qualify as a capital item.

The new $2,500 threshold applies to any such item substantiated by an invoice. As a result, small businesses will be able to immediately deduct many expenditures that would otherwise need to be spread over a period of years through annual depreciation deductions.

Click Here to read the full article on the IRS website.

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