The de Minimus Safe Harbor Rule

Question 1

What is the de minimis safe harbor rule?

Answer 1

The de minimis safe harbor rule applies when there is an accounting policy to expenses certain property at the beginning of the year. It allows a company to expense items costing up to $5,000 each.

Question 2

What is the limitation for de minimis safe harbor Deduction for taxpayers who do not have an accounting policy or AFS (applicable financial statement)?

Answer 2

Taxpayers with no AFS can deduct items that cost up to $2,500.