Can you Capitalise spare parts?
Can you Capitalise spare parts? Capitalize and Depreciate › Under the new regulations taxpayers can choose to capitalize and depreciate the cost of any material or supply, including rotable spare parts. The election is made by capitalizing the amount paid and by beginning to depreciate the cost in that year. Do you depreciate spare parts? When treated as inventory, the spare parts are not depreciated and are expensed when placed in service, similar to maintenance expense. When considered to be long-lived assets, the spare parts are depreciated over their useful lives or the remaining service lives of the related equipment....