USA Can RV (100% business use) improvements be capitalized?

[amynic]

We have spent a good $60k on RV improvements (flooring, generators, bathroom upgrades). Can these expenses be depreciated?

 

[ladyrider]

Good question and I just had a similar issue come up with a client. It's confusing since the original RV purchase would have fallen under the old limits of FA but the improvements are under the limits. In my mind the improvements are directly adding to the value of the existing asset so what I did was create a sub account under the original asset as below and then put the improvements in that account. Since I don't do the taxes for my clients at least it will be separated for the CPA / Tax preparer to see it on the BS and if they decide to expense it I can do a quick adjusting entry.

15000 RV
15001 Improvements to RV