>Why in the world would you not want to claim all legitimate
>expenses? "Safe harbor" does not mean "maximum allowable"
The safe harbor for small taxpayers does have a maximum
amount for total expenses. If you exceed the maximum you
cannot use the safe harbor at all. The safe harbor can only
be used "if the total amount paid during the taxable year
for repairs, maintenance, improvements, and similar
activities performed on the eligible building does not
exceed the lesser of $10,000 or 2 percent of the unadjusted
basis of the building."
As stated in the OP's original question, the basis of his
building is $200,000, so 2% is $4,000. Therefore, if his
total expenses for maintenance, repairs, and improvements
are more than $4,000 he cannot use the safe harbor. He is
asking whether he can omit an expense in order to stay under
that maximum and be able to use the safe harbor. He'd rather
forgo deducting a small expense than lose the ability to use
the safe harbor.
Bob Sandler