What is Uniform capitalization rules?
In short
The uniform capitalization rules require producers and many resellers to include in inventory or other property not only direct costs but also an allocable share of indirect costs, including some administrative costs.
Key takeaways
- The capitalized costs are recovered through cost of goods sold or depreciation.
- Businesses that meet the small business gross receipts test are exempt.
- Tax inventory can therefore differ from book inventory.
Where it's tested
REG: Property Transactions: Basis & Cost Recovery — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
Under the One Big Beautiful Bill Act, which statement about bonus depreciation is correct for qualifying property acquired after January 19, 2025?