IRS Increases Safe Harbor De Minimis Amount for Certain Taxpayers

Rödl & Partner Tax Matters Vol 2015-17, republished in July 2024

The IRS recently announced that the safe harbor amount for purchases that can be deducted under the final tangible property regulations is increasing for taxpayers without applicable financial statements. Per Notice 2015-82, the expense amount is increased from $500 per item to $2,500 per item.

Notice 2015-82 responds to comments that the $500 per item safe harbor amount allowed under the final tangible property regulations was not high enough to reduce the administrative burden for taxpayers. The new safe harbor amount applies to costs for tax years beginning on or after January 1, 2016, although the IRS has stated that they will provide audit protection by not challenging the use of the $2,500 threshold for tax years 2012 through 2015.

For questions on implementing the higher safe harbor amount, please speak with your local Rödl & Partner representative.

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