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Posted by boostm3 on March 21, 2008, 9:29 am
Please log in for more thread options On Mar 21, 8:33 am, an_ordinary_guy_...@hotmail.com (Bill) wrote:
> elliott.pa...@gmail.com (boostm3) posted:
>
>
>
> >I own a condominium in a hi rise buildg. This
> >summer, the board has decided the need to
> >levy an assessment on all unit owners to pay
> >for the purchase of a brand new cooling tower
> >and related equipment.. The current
> >equipment is old and in such a condition that it
> >has been advised it be replaced by the
> >summer, otherwise run the real risk of going
> >hot all summer.
> >Two questions:
> >1) would the replacement of said equipment
> >be considered a Capital Improvement?
> >2) if so, in the setting of the condominium,
> >since we all own our units plus a percentage
> >of all 'common elements,, do you think we
> >would be permitted to claim our share of the
> >capital improvement up to the percentage of
> >our ownership in common elements?
>
> Your condo documents will control; however, common sense dictates that
> the board undoubtedly had a responsibility to _maintain_ facilities
> necessary for habitability -- which would include heating and air
> conditioning equipment. Especially in view of the advice the board
> received indicating a possible failure of the old, existing equipment,
> the board would be guilty of a "failure to maintain" the property, if
> they didn't act to replace this.
>
> Therefore, it is not primarily a 'capital improvement' -- but rather a
> maintenance expenditure. So the plain answer to your first question is
> "No."
>
> I truly don't understand the second question: Of course, based on the
> entire condominium concept, you automatically own a share of the common
> elements -- but that "ownership" is simply reflected in the value of
> your individual unit. There's nothing there to "share" except the value
> of your unit -- which would surely decline, if the overall common
> elements were not maintained properly.
>
> Bill
>
> --
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Ok.. that explains it..... But on a larger scale, what is the common
line thats drawn to help decide whether a home's upgrade is considered
Maintenance or a Capital Improvement?
========================================= MODERATOR'S COMMENT:
When responding please delete all unnecessary material from the prior post.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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