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Irs Form1040x

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Irs Form1040x

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The Irs Form1040x

Irs form1040x 7. Irs form1040x   Costs You Can Deduct or Capitalize Table of Contents What's New Introduction Topics - This chapter discusses: Useful Items - You may want to see: Carrying Charges Research and Experimental CostsProduct. Irs form1040x Costs not included. Irs form1040x Intangible Drilling Costs Exploration CostsPartnerships and S corporations. Irs form1040x Development Costs Circulation Costs Business Start-Up and Organizational Costs Reforestation Costs Retired Asset Removal Costs Barrier Removal CostsOther barrier removals. Irs form1040x Film and Television Production Costs What's New Film and television productions costs. Irs form1040x  The election to expense film and television production costs does not apply to productions that begin after December 31, 2013. Irs form1040x See Film and Television Production Costs , later. Irs form1040x Introduction This chapter discusses costs you can elect to deduct or capitalize. Irs form1040x You generally deduct a cost as a current business expense by subtracting it from your income in either the year you incur it or the year you pay it. Irs form1040x If you capitalize a cost, you may be able to recover it over a period of years through periodic deductions for amortization, depletion, or depreciation. Irs form1040x When you capitalize a cost, you add it to the basis of property to which it relates. Irs form1040x A partnership, corporation, estate, or trust makes the election to deduct or capitalize the costs discussed in this chapter except for exploration costs for mineral deposits. Irs form1040x Each individual partner, shareholder, or beneficiary elects whether to deduct or capitalize exploration costs. Irs form1040x You may be subject to the alternative minimum tax (AMT) if you deduct research and experimental, intangible drilling, exploration, development, circulation, or business organizational costs. Irs form1040x For more information on the alternative minimum tax, see the instructions for the following forms. Irs form1040x Form 6251, Alternative Minimum Tax—Individuals. Irs form1040x Form 4626, Alternative Minimum Tax—Corporations. Irs form1040x Topics - This chapter discusses: Carrying charges Research and experimental costs Intangible drilling costs Exploration costs Development costs Circulation costs Qualified disaster expenses Business start-up and organizational costs Reforestation costs Retired asset removal costs Barrier removal costs Film and television production costs Useful Items - You may want to see: Publication 544 Sales and Other Dispositions of Assets Form (and Instructions) 3468 Investment Credit 8826 Disabled Access Credit See chapter 12 for information about getting publications and forms. Irs form1040x Carrying Charges Carrying charges include the taxes and interest you pay to carry or develop real property or to carry, transport, or install personal property. Irs form1040x Certain carrying charges must be capitalized under the uniform capitalization rules. Irs form1040x (For information on capitalization of interest, see chapter 4 . Irs form1040x ) You can elect to capitalize carrying charges not subject to the uniform capitalization rules, but only if they are otherwise deductible. Irs form1040x You can elect to capitalize carrying charges separately for each project you have and for each type of carrying charge. Irs form1040x For unimproved and unproductive real property, your election is good for only 1 year. Irs form1040x You must decide whether to capitalize carrying charges each year the property remains unimproved and unproductive. Irs form1040x For other real property, your election to capitalize carrying charges remains in effect until construction or development is completed. Irs form1040x For personal property, your election is effective until the date you install or first use it, whichever is later. Irs form1040x How to make the election. Irs form1040x   To make the election to capitalize a carrying charge, attach a statement to your original tax return for the year the election is to be effective indicating which charges you are electing to capitalize. Irs form1040x However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the return (excluding extensions). Irs form1040x Attach the statement to the amended return and write “Filed pursuant to section 301. Irs form1040x 9100-2” on the statement. Irs form1040x File the amended return at the same address you filed the original return. Irs form1040x Research and Experimental Costs The costs of research and experimentation are generally capital expenses. Irs form1040x However, you can elect to deduct these costs as a current business expense. Irs form1040x Your election to deduct these costs is binding for the year it is made and for all later years unless you get IRS approval to make a change. Irs form1040x If you meet certain requirements, you may elect to defer and amortize research and experimental costs. Irs form1040x For information on electing to defer and amortize these costs, see Research and Experimental Costs in chapter 8. Irs form1040x Research and experimental costs defined. Irs form1040x   Research and experimental costs are reasonable costs you incur in your trade or business for activities intended to provide information that would eliminate uncertainty about the development or improvement of a product. Irs form1040x Uncertainty exists if the information available to you does not establish how to develop or improve a product or the appropriate design of a product. Irs form1040x Whether costs qualify as research and experimental costs depends on the nature of the activity to which the costs relate rather than on the nature of the product or improvement being developed or the level of technological advancement. Irs form1040x      The costs of obtaining a patent, including attorneys' fees paid or incurred in making and perfecting a patent application, are research and experimental costs. Irs form1040x However, costs paid or incurred to obtain another's patent are not research and experimental costs. Irs form1040x Product. Irs form1040x   The term “product” includes any of the following items. Irs form1040x Formula. Irs form1040x Invention. Irs form1040x Patent. Irs form1040x Pilot model. Irs form1040x Process. Irs form1040x Technique. Irs form1040x Property similar to the items listed above. Irs form1040x It also includes products used by you in your trade or business or held for sale, lease, or license. Irs form1040x Costs not included. Irs form1040x   Research and experimental costs do not include expenses for any of the following activities. Irs form1040x Advertising or promotions. Irs form1040x Consumer surveys. Irs form1040x Efficiency surveys. Irs form1040x Management studies. Irs form1040x Quality control testing. Irs form1040x Research in connection with literary, historical, or similar projects. Irs form1040x The acquisition of another's patent, model, production, or process. Irs form1040x When and how to elect. Irs form1040x   You make the election to deduct research and experimental costs by deducting them on your tax return for the year in which you first pay or incur research and experimental costs. Irs form1040x If you do not make the election to deduct research and experimental costs in the first year in which you pay or incur the costs, you can deduct the costs in a later year only with approval from the IRS. Irs form1040x Deducting or Amortizing Research and Experimentation Costs IF you . Irs form1040x . Irs form1040x . Irs form1040x THEN . Irs form1040x . Irs form1040x . Irs form1040x Elect to deduct research and experimental costs as a current business expense Deduct all research and experimental costs in the first year you pay or incur the costs and all later years. Irs form1040x Do not deduct research and experimental costs as a current business expense If you meet the requirements, amortize them over at least 60 months, starting with the month you first receive an economic benefit from the research. Irs form1040x See Research and Experimental Costs in chapter 8. Irs form1040x Research credit. Irs form1040x   If you pay or incur qualified research expenses, you may be able to take the research credit. Irs form1040x For more information see Form 6765, Credit for Increasing Research Activities and its instructions. Irs form1040x Intangible Drilling Costs The costs of developing oil, gas, or geothermal wells are ordinarily capital expenditures. Irs form1040x You can usually recover them through depreciation or depletion. Irs form1040x However, you can elect to deduct intangible drilling costs (IDCs) as a current business expense. Irs form1040x These are certain drilling and development costs for wells in the United States in which you hold an operating or working interest. Irs form1040x You can deduct only costs for drilling or preparing a well for the production of oil, gas, or geothermal steam or hot water. Irs form1040x You can elect to deduct only the costs of items with no salvage value. Irs form1040x These include wages, fuel, repairs, hauling, and supplies related to drilling wells and preparing them for production. Irs form1040x Your cost for any drilling or development work done by contractors under any form of contract is also an IDC. Irs form1040x However, see Amounts paid to contractor that must be capitalized , later. Irs form1040x You can also elect to deduct the cost of drilling exploratory bore holes to determine the location and delineation of offshore hydrocarbon deposits if the shaft is capable of conducting hydrocarbons to the surface on completion. Irs form1040x It does not matter whether there is any intent to produce hydrocarbons. Irs form1040x If you do not elect to deduct your IDCs as a current business expense, you can elect to deduct them over the 60-month period beginning with the month they were paid or incurred. Irs form1040x Amounts paid to contractor that must be capitalized. Irs form1040x   Amounts paid to a contractor must be capitalized if they are either: Amounts properly allocable to the cost of depreciable property, or Amounts paid only out of production or proceeds from production if these amounts are depletable income to the recipient. Irs form1040x How to make the election. Irs form1040x   You elect to deduct IDCs as a current business expense by taking the deduction on your income tax return for the first tax year you have eligible costs. Irs form1040x No formal statement is required. Irs form1040x If you file Schedule C (Form 1040), enter these costs under “Other expenses. Irs form1040x ”   For oil and gas wells, your election is binding for the year it is made and for all later years. Irs form1040x For geothermal wells, your election can be revoked by the filing of an amended return on which you do not take the deduction. Irs form1040x You can file the amended return for the year up to the normal time of expiration for filing a claim for credit or refund, generally, within 3 years after the date you filed the original return or within 2 years after the date you paid the tax, whichever is later. Irs form1040x Energy credit for costs of geothermal wells. Irs form1040x   If you capitalize the drilling and development costs of geothermal wells that you place in service during the tax year, you may be able to claim a business energy credit. Irs form1040x See the Instructions for Form 3468 for more information. Irs form1040x Nonproductive well. Irs form1040x   If you capitalize your IDCs, you have another option if the well is nonproductive. Irs form1040x You can deduct the IDCs of the nonproductive well as an ordinary loss. Irs form1040x You must indicate and clearly state your election on your tax return for the year the well is completed. Irs form1040x Once made, the election for oil and gas wells is binding for all later years. Irs form1040x You can revoke your election for a geothermal well by filing an amended return that does not claim the loss. Irs form1040x Costs incurred outside the United States. Irs form1040x   You cannot deduct as a current business expense all the IDCs paid or incurred for an oil, gas, or geothermal well located outside the United States. Irs form1040x However, you can elect to include the costs in the adjusted basis of the well to figure depletion or depreciation. Irs form1040x If you do not make this election, you can deduct the costs over the 10-year period beginning with the tax year in which you paid or incurred them. Irs form1040x These rules do not apply to a nonproductive well. Irs form1040x Exploration Costs The costs of determining the existence, location, extent, or quality of any mineral deposit are ordinarily capital expenditures if the costs lead to the development of a mine. Irs form1040x You recover these costs through depletion as the mineral is removed from the ground. Irs form1040x However, you can elect to deduct domestic exploration costs paid or incurred before the beginning of the development stage of the mine (except those for oil and gas wells). Irs form1040x How to make the election. Irs form1040x   You elect to deduct exploration costs by taking the deduction on your income tax return, or on an amended income tax return, for the first tax year for which you wish to deduct the costs paid or incurred during the tax year. Irs form1040x Your return must adequately describe and identify each property or mine, and clearly state how much is being deducted for each one. Irs form1040x The election applies to the tax year you make this election and all later tax years. Irs form1040x Partnerships and S corporations. Irs form1040x   Each partner, not the partnership, elects whether to capitalize or to deduct that partner's share of exploration costs. Irs form1040x Each shareholder, not the S corporation, elects whether to capitalize or to deduct that shareholder's share of exploration costs. Irs form1040x Reduced corporate deductions for exploration costs. Irs form1040x   A corporation (other than an S corporation) can deduct only 70% of its domestic exploration costs. Irs form1040x It must capitalize the remaining 30% of costs and amortize them over the 60-month period starting with the month the exploration costs are paid or incurred. Irs form1040x A corporation may also elect to capitalize and amortize mining exploration costs over a 10-year period. Irs form1040x For more information on this method of amortization, see Internal Revenue Code section 59(e). Irs form1040x   The 30% the corporation capitalizes cannot be added to its basis in the property to figure cost depletion. Irs form1040x However, the amount amortized is treated as additional depreciation and is subject to recapture as ordinary income on a disposition of the property. Irs form1040x See Section 1250 Property under Depreciation Recapture in chapter 3 of Publication 544. Irs form1040x   These rules also apply to the deduction of development costs by corporations. Irs form1040x See Development Costs , later. Irs form1040x Recapture of exploration expenses. Irs form1040x   When your mine reaches the producing stage, you must recapture any exploration costs you elected to deduct. Irs form1040x Use either of the following methods. Irs form1040x Method 1—Include the deducted costs in gross income for the tax year the mine reaches the producing stage. Irs form1040x Your election must be clearly indicated on the return. Irs form1040x Increase your adjusted basis in the mine by the amount included in income. Irs form1040x Generally, you must elect this recapture method by the due date (including extensions) of your return. Irs form1040x However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the return (excluding extensions). Irs form1040x Make the election on your amended return and write “Filed pursuant to section 301. Irs form1040x 9100-2” on the form where you are including the income. Irs form1040x File the amended return at the same address you filed the original return. Irs form1040x Method 2—Do not claim any depletion deduction for the tax year the mine reaches the producing stage and any later tax years until the depletion you would have deducted equals the exploration costs you deducted. Irs form1040x   You also must recapture deducted exploration costs if you receive a bonus or royalty from mine property before it reaches the producing stage. Irs form1040x Do not claim any depletion deduction for the tax year you receive the bonus or royalty and any later tax years until the depletion you would have deducted equals the exploration costs you deducted. Irs form1040x   Generally, if you dispose of the mine before you have fully recaptured the exploration costs you deducted, recapture the balance by treating all or part of your gain as ordinary income. Irs form1040x Under these circumstances, you generally treat as ordinary income all of your gain if it is less than your adjusted exploration costs with respect to the mine. Irs form1040x If your gain is more than your adjusted exploration costs, treat as ordinary income only a part of your gain, up to the amount of your adjusted exploration costs. Irs form1040x Foreign exploration costs. Irs form1040x   If you pay or incur exploration costs for a mine or other natural deposit located outside the United States, you cannot deduct all the costs in the current year. Irs form1040x You can elect to include the costs (other than for an oil, gas, or geothermal well) in the adjusted basis of the mineral property to figure cost depletion. Irs form1040x (Cost depletion is discussed in chapter 9 . Irs form1040x ) If you do not make this election, you must deduct the costs over the 10-year period beginning with the tax year in which you pay or incur them. Irs form1040x These rules also apply to foreign development costs. Irs form1040x Development Costs You can deduct costs paid or incurred during the tax year for developing a mine or any other natural deposit (other than an oil or gas well) located in the United States. Irs form1040x These costs must be paid or incurred after the discovery of ores or minerals in commercially marketable quantities. Irs form1040x Development costs also include depreciation on improvements used in the development of ores or minerals and costs incurred for you by a contractor. Irs form1040x Development costs do not include the costs for the acquisition or improvement of depreciable property. Irs form1040x Instead of deducting development costs in the year paid or incurred, you can elect to treat the cost as deferred expenses and deduct them ratably as the units of produced ores or minerals benefited by the expenses are sold. Irs form1040x This election applies each tax year to expenses paid or incurred in that year. Irs form1040x Once made, the election is binding for the year and cannot be revoked for any reason. Irs form1040x How to make the election. Irs form1040x   The election to deduct development costs ratably as the ores or minerals are sold must be made for each mine or other natural deposit by a clear indication on your return or by a statement filed with the IRS office where you file your return. Irs form1040x Generally, you must make the election by the due date of the return (including extensions). Irs form1040x However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the return (excluding extensions). Irs form1040x Clearly indicate the election on your amended return and write “Filed pursuant to section 301. Irs form1040x 9100-2. Irs form1040x ” File the amended return at the same address you filed the original return. Irs form1040x Foreign development costs. Irs form1040x   The rules discussed earlier for foreign exploration costs apply to foreign development costs. Irs form1040x Reduced corporate deductions for development costs. Irs form1040x   The rules discussed earlier for reduced corporate deductions for exploration costs also apply to corporate deductions for development costs. Irs form1040x Circulation Costs A publisher can deduct as a current business expense the costs of establishing, maintaining, or increasing the circulation of a newspaper, magazine, or other periodical. Irs form1040x For example, a publisher can deduct the cost of hiring extra employees for a limited time to get new subscriptions through telephone calls. Irs form1040x Circulation costs are deductible even if they normally would be capitalized. Irs form1040x This rule does not apply to the following costs that must be capitalized. Irs form1040x The purchase of land or depreciable property. Irs form1040x The acquisition of circulation through the purchase of any part of the business of another publisher of a newspaper, magazine, or other periodical, including the purchase of another publisher's list of subscribers. Irs form1040x Other treatment of circulation costs. Irs form1040x   If you do not want to deduct circulation costs as a current business expense, you can elect one of the following ways to recover these costs. Irs form1040x Capitalize all circulation costs that are properly chargeable to a capital account (see chapter 1 ). Irs form1040x Amortize circulation costs over the 3-year period beginning with the tax year they were paid or incurred. Irs form1040x How to make the election. Irs form1040x   You elect to capitalize circulation costs by attaching a statement to your return for the first tax year the election applies. Irs form1040x Your election is binding for the year it is made and for all later years, unless you get IRS approval to revoke it. Irs form1040x Business Start-Up and Organizational Costs Business start-up and organizational costs are generally capital expenditures. Irs form1040x However, you can elect to deduct up to $5,000 of business start-up and $5,000 of organizational costs paid or incurred after October 22, 2004. Irs form1040x The $5,000 deduction is reduced by the amount your total start-up or organizational costs exceed $50,000. Irs form1040x Any remaining costs must be amortized. Irs form1040x For information about amortizing start-up and organizational costs, see chapter 8 . Irs form1040x Start-up costs include any amounts paid or incurred in connection with creating an active trade or business or investigating the creation or acquisition of an active trade or business. Irs form1040x Organizational costs include the costs of creating a corporation. Irs form1040x For more information on start-up and organizational costs, see chapter 8 . Irs form1040x How to make the election. Irs form1040x   You elect to deduct the start-up or organizational costs by claiming the deduction on your income tax return (filed by the due date including extensions) for the tax year in which the active trade or business begins. Irs form1040x However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the return (excluding extensions). Irs form1040x Clearly indicate the election on your amended return and write “Filed pursuant to section 301. Irs form1040x 9100-2. Irs form1040x ” File the amended return at the same address you filed the original return. Irs form1040x The election applies when computing taxable income for the current tax year and all subsequent years. Irs form1040x Reforestation Costs Reforestation costs are generally capital expenditures. Irs form1040x However, you can elect to deduct up to $10,000 ($5,000 if married filing separately; $0 for a trust) of qualifying reforestation costs paid or incurred after October 22, 2004, for each qualified timber property. Irs form1040x The remaining costs can be amortized over an 84-month period. Irs form1040x For information about amortizing reforestation costs, see chapter 8 . Irs form1040x Qualifying reforestation costs are the direct costs of planting or seeding for forestation or reforestation. Irs form1040x Qualified timber property is property that contains trees in significant commercial quantities. Irs form1040x See chapter 8 for more information on qualifying reforestation costs and qualified timber property. Irs form1040x If you elect to deduct qualified reforestation costs, create and maintain separate timber accounts for each qualified timber property and include all reforestation costs and the dates each was applied. Irs form1040x Do not include this qualified timber property in any account (for example, depletion block) for which depletion is allowed. Irs form1040x How to make the election. Irs form1040x   You elect to deduct qualifying reforestation costs by claiming the deduction on your timely filed income tax return (including extensions) for the tax year the expenses were paid or incurred. Irs form1040x If Form T (Timber), Forest Activities Schedule, is required, complete Part IV of Form T. Irs form1040x If Form T is not required, attach a statement containing the following information for each qualified timber property for which an election is being made. Irs form1040x The unique stand identification numbers. Irs form1040x The total number of acres reforested during the tax year. Irs form1040x The nature of the reforestation treatments. Irs form1040x The total amounts of qualified reforestation expenditures eligible to be amortized or deducted. Irs form1040x   If you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the return (excluding extensions). Irs form1040x Clearly indicate the election on your amended return and write “Filed pursuant to section 301. Irs form1040x 9100-2. Irs form1040x ” File the amended return at the same address you filed the original return. Irs form1040x The election applies when computing taxable income for the current tax year and all subsequent years. Irs form1040x   For additional information on reforestation costs, see chapter 8 . Irs form1040x Recapture. Irs form1040x   This deduction may have to be recaptured as ordinary income under section 1245 when you sell or otherwise dispose of the property that would have received an addition to basis if you had not elected to deduct the expenditure. Irs form1040x For more information on recapturing the deduction, see Depreciation Recapture in Publication 544. Irs form1040x Retired Asset Removal Costs If you retire and remove a depreciable asset in connection with the installation or production of a replacement asset, you can deduct the costs of removing the retired asset. Irs form1040x However, if you replace a component (part) of a depreciable asset, capitalize the removal costs if the replacement is an improvement and deduct the costs if the replacement is a repair. Irs form1040x Barrier Removal Costs The cost of an improvement to a business asset is normally a capital expense. Irs form1040x However, you can elect to deduct the costs of making a facility or public transportation vehicle more accessible to and usable by those who are disabled or elderly. Irs form1040x You must own or lease the facility or vehicle for use in connection with your trade or business. Irs form1040x A facility is all or any part of buildings, structures, equipment, roads, walks, parking lots, or similar real or personal property. Irs form1040x A public transportation vehicle is a vehicle, such as a bus or railroad car, that provides transportation service to the public (including service for your customers, even if you are not in the business of providing transportation services). Irs form1040x You cannot deduct any costs that you paid or incurred to completely renovate or build a facility or public transportation vehicle or to replace depreciable property in the normal course of business. Irs form1040x Deduction limit. Irs form1040x   The most you can deduct as a cost of removing barriers to the disabled and the elderly for any tax year is $15,000. Irs form1040x However, you can add any costs over this limit to the basis of the property and depreciate these excess costs. Irs form1040x Partners and partnerships. Irs form1040x   The $15,000 limit applies to a partnership and also to each partner in the partnership. Irs form1040x A partner can allocate the $15,000 limit in any manner among the partner's individually incurred costs and the partner's distributive share of partnership costs. Irs form1040x If the partner cannot deduct the entire share of partnership costs, the partnership can add any costs not deducted to the basis of the improved property. Irs form1040x   A partnership must be able to show that any amount added to basis was not deducted by the partner and that it was over a partner's $15,000 limit (as determined by the partner). Irs form1040x If the partnership cannot show this, it is presumed that the partner was able to deduct the distributive share of the partnership's costs in full. Irs form1040x Example. Irs form1040x Emilio Azul's distributive share of ABC partnership's deductible expenses for the removal of architectural barriers was $14,000. Irs form1040x Emilio had $12,000 of similar expenses in his sole proprietorship. Irs form1040x He elected to deduct $7,000 of them. Irs form1040x Emilio allocated the remaining $8,000 of the $15,000 limit to his share of ABC's expenses. Irs form1040x Emilio can add the excess $5,000 of his own expenses to the basis of the property used in his business. Irs form1040x Also, if ABC can show that Emilio could not deduct $6,000 ($14,000 – $8,000) of his share of the partnership's expenses because of how Emilio applied the limit, ABC can add $6,000 to the basis of its property. Irs form1040x Qualification standards. Irs form1040x   You can deduct your costs as a current expense only if the barrier removal meets the guidelines and requirements issued by the Architectural and Transportation Barriers Compliance Board under the Americans with Disabilities Act (ADA) of 1990. Irs form1040x You can view the Americans with Disabilities Act at www. Irs form1040x ada. Irs form1040x gov/pubs/ada. Irs form1040x htm. Irs form1040x   The following is a list of some architectural barrier removal costs that can be deducted. Irs form1040x Ground and floor surfaces. Irs form1040x Walks. Irs form1040x Parking lots. Irs form1040x Ramps. Irs form1040x Entrances. Irs form1040x Doors and doorways. Irs form1040x Stairs. Irs form1040x Floors. Irs form1040x Toilet rooms. Irs form1040x Water fountains. Irs form1040x Public telephones. Irs form1040x Elevators. Irs form1040x Controls. Irs form1040x Signage. Irs form1040x Alarms. Irs form1040x Protruding objects. Irs form1040x Symbols of accessibility. Irs form1040x You can find the ADA guidelines and requirements for architectural barrier removal at www. Irs form1040x usdoj. Irs form1040x gov/crt/ada/reg3a. Irs form1040x html. Irs form1040x   The costs for removal of transportation barriers from rail facilities, buses, and rapid and light rail vehicles are deductible. Irs form1040x You can find the guidelines and requirements for transportation barrier removal at www. Irs form1040x fta. Irs form1040x dot. Irs form1040x gov. Irs form1040x   Also, you can access the ADA website at www. Irs form1040x ada. Irs form1040x gov for additional information. Irs form1040x Other barrier removals. Irs form1040x   To be deductible, expenses of removing any barrier not covered by the above standards must meet all three of the following tests. Irs form1040x The removed barrier must be a substantial barrier to access or use of a facility or public transportation vehicle by persons who have a disability or are elderly. Irs form1040x The removed barrier must have been a barrier for at least one major group of persons who have a disability or are elderly (such as people who are blind, deaf, or wheelchair users). Irs form1040x The barrier must be removed without creating any new barrier that significantly impairs access to or use of the facility or vehicle by a major group of persons who have a disability or are elderly. Irs form1040x How to make the election. Irs form1040x   If you elect to deduct your costs for removing barriers to the disabled or the elderly, claim the deduction on your income tax return (partnership return for partnerships) for the tax year the expenses were paid or incurred. Irs form1040x Identify the deduction as a separate item. Irs form1040x The election applies to all the qualifying costs you have during the year, up to the $15,000 limit. Irs form1040x If you make this election, you must maintain adequate records to support your deduction. Irs form1040x   For your election to be valid, you generally must file your return by its due date, including extensions. Irs form1040x However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the return (excluding extensions). Irs form1040x Clearly indicate the election on your amended return and write “Filed pursuant to section 301. Irs form1040x 9100-2. Irs form1040x ” File the amended return at the same address you filed the original return. Irs form1040x Your election is irrevocable after the due date, including extensions, of your return. Irs form1040x Disabled access credit. Irs form1040x   If you make your business accessible to persons with disabilities and your business is an eligible small business, you may be able to claim the disabled access credit. Irs form1040x If you choose to claim the credit, you must reduce the amount you deduct or capitalize by the amount of the credit. Irs form1040x   For more information, see Form 8826, Disabled Access Credit. Irs form1040x Film and Television Production Costs Film and television production costs are generally capital expenses. Irs form1040x However, you can elect to deduct costs paid or incurred for certain productions commencing before January 1, 2014. Irs form1040x For more information, see section 181 of the Internal Revenue Code and the related Treasury Regulations. 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