Repairs versus Improvements: New Rules for Deductibility

5 Mar

The IRS and Treasury have issued long-awaited, comprehensive regulations on the capitalization of amounts paid to acquire, produce or improve tangible property. The regulations, released at the end of 2011 and effective immediately for most taxpayers, provide the standards that businesses must now apply to determine whether expenditures can be deducted as repairs or must be capitalized and then recovered over a period of years.

The regulations are broad and far-reaching – they apply to every business taxpayer that uses tangible property, whether owned or leased, regardless of the form of entity that operates the business, and regardless of the entity’s foreign or domestic status. They apply to manufacturers, wholesalers, distributors, and retailers.

The new regulations have taken effect and steps must be taken to comply with them. They generally apply to amounts paid or incurred in tax years beginning on or after January 1, 2012. Thus, for calendar year taxpayers, the rules already apply. Some of the rules build upon rules already in place; other requirements, however, are completely new. The IRS will take comments and consider further changes, so any plans set forth to respond to these new regulations must themselves be ready for fine tuning.

Read More Here About Repairs versus Improvements: New Rules for Deductibility

About Mantyla McReynolds

Mantyla McReynolds began in 1989 when Don Mantyla and Kim McReynolds had a vision of creating their own business, their own legacy.  Born leaders, Don and Kim have successfully expanded the firm to over 30 employees by hiring bright thinkers and creating a positive work environment.

Mantyla McReynolds is a local CPA firm, based in one of the greatest places to live: Salt Lake City, Utah.  The firm has the experience and expertise to help businesses throughout Utah, the United States and the world, and it has serviced small business, middle-market and international organizations for over 20 years.  Mantyla McReynolds is a BDO Seidman Alliance firm, offering experienced and accessible service teams, world-class engagement management and a focus on quality and efficiency.

With a commitment to timely service and communication, the professionals at Mantyla McReynolds have the experience and knowledge to help you succeed.

Memberships/associations: American Institute of Certified Public Accountants (AICPA), Utah Association of Certified Public Accountants (UACPA), Public Company Accounting Oversight Board (PCAOB) registrant and Center for Public Company Accounting Oversight Board (CPCAF).  As members of the PCAOB and CPCAF, Mantyla McReynolds is required to undergo rigorous quality control reviews, performed by government regulators and other CPA firms.  The reviews are performed regularly and examine all internal procedures and records.  As a result of these reviews, the firm has obtained unqualified approval to continue performing accounting and auditing work for business clients.

Five Gateway Center
178 S. Rio Grande Street,
Suite 200
Salt Lake City, UT 84101
Phone: 801-269-1818
Fax: 801-266-3481
info@mmacpa.com
http://www.mmacpa.com

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s

%d bloggers like this: