This week’s interview on Financial Insider Weekly is with attorney G. Scott Haislet. Our interview subject is "New rules for repair deductions and capitalization for business owners and real estate investors."
Profit motive required for business deductions
Businesses that generate consistent losses are an audit flag to the IRS. Under Internal Revenue Code Section 183, if an activity isn’t engaged in for profit, the deductions for the activity are generally limited to the amount of income from the activity.