What Is the Proper Tax Treatment of Capital Improvements for a Residential

question 59

Multiple Choice

What is the proper tax treatment of capital improvements for a residential or commercial rental property?

• A)IRC section 179 may be claimed.
• B)Can be deducted as ordinary expenses.
• C)Must be depreciated using the double-declining balance method.
• D)Must be depreciated using straight-line over 27½ or 39 years.

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Definitions:

Situational Factors

Factors affecting the consumer decision process; those that are specific to the situation that may override, or at least influence, psychological and social issues.

Lifestyle

The interests, opinions, behaviors, and behavioral orientations of an individual, group, or culture.

Conspicuous Consumption

The spending of money on and the acquisition of luxury goods and services to display economic power and social status.

Situational Factors

External factors such as time, location, and social context that can influence consumers' buying behaviors or decision-making processes.