IRS releases tangible property safe harbor guidance for retailers and restaurants

IRS releases tangible property safe harbor guidance for retailers and restaurantsThe IRS issued a revenue procedure (Rev. Proc. 2015-56) on Nov. 19 that provides retail and restaurant taxpayers with a safe harbor method for determining deductible repairs for remodel and refresh projects.

The safe harbor not only includes a methodology for determining the repair versus improvement portion of such costs, but also covers the application of Section 263A, the disposition rules and general asset account elections for such locations. This long-awaited guidance provides a simplified approach to analyzing complicated facts related to remodel and refresh projects for restaurant and retail taxpayers.

For more information, see our Tax Flash.

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