Virtual

Expense vs. Capitalize—Getting It Right for Taxes

Date: Aug. 1, 2023

Time: 8 a.m. – 3:30 p.m. PT

CPE: 8

Overview

Is an expenditure associated with tangible property deductible or must it be capitalized? Learn the rules for treatment of amounts paid to acquire, produce, repair, or improve tangible property and proper accounting for dispositions of property subject to depreciation. The capitalization regulations provide objective standards and bright-line rules intended to simplify compliance with the capitalization provisions contained in Section 263(a) of the Internal Revenue Code. This program highlights issues involving what must be capitalized, what can be treated as a repair and items related to depreciation of fixed assets.

Product Code
1000002197-120194
Credit Type
CPE: 8
CPE-Technical: 8
Intended Audience
CPAs, accountants, and financial professionals who advise clients and/or prepare tax returns dealing with expenditures to repair, improve, or acquire tangible property. May also be suitable for public practice.
NASBA Field of Study
Taxes
Level of Difficulty
Intermediate
Prerequisites
General Construction accounting and tax knowledge
Advance Preparation
None

Learning Objectives

Participants will be able to:Apply capitalization rules in general

Identify exceptions for materials and supplies

Account for costs associated with rotable spare parts

Apply “de minimis” rules for entities with and without an “applicable financial statement”

Determine amounts considered “spent to acquire tangible property”

Identify improvements to tangible property › Unit of property definitions, including special rules applicable to real property › Leased property rules for lessees and lessors › Routine maintenance safe harbors

Determine what is a “betterment” of property

Recognize and capture costs of restoration of property

Definition of adapting a property to a new or different use

Determining property that qualifies for Section 179 expensing treatment

Applying cost recovery rules

Major Subjects

General rules for expensing vs. capitalizing
Capital expenditures
Payments to acquire assets
Depreciation and section 179 election
Payments to improve property
Provisions that override capitalization rules
Repairs
Accounting methods

Faculty

Ini Adesanya

Additional Details

This course originally aired on 8/1/2023. The instructor will be available via the chat feature to answer questions during the presentation.

Expense vs. Capitalize—Getting It Right for Taxes

Member

Nonmember

Overview

Product Code

Credit Type

Intended Audience

NASBA Field of Study

Level of Difficulty

Prerequisites

Advance Preparation

Learning Objectives

Major Subjects

Faculty

Additional Details