Listed PropertyReal estate listed
Real estate listed
Monument-protected real estate is a certain category of real estate that can be depreciated and is taxed separately if it is used for commercial purposes for no more than 50% of the year. These include, for example, automobiles and computer hardware. Listed property regulations restrict the amount of deduction and amortization that can be made if the assets are not predominantly used in a company or deal.
Since 1 January 2010, mobile telephones and other similar telecommunication equipment are no longer classified as listed objects. Quoted property includes all company cars operated by executives, staff and/or stockholders. Simply put, it is property used for both commercial and private use.
These property regulations have been incorporated into fiscal legislation to prevent individuals from making claims for deduction for personal use of property on the pretext that it has been used in a company or trades. The Internal Revenue Service (IRS) states that the listed property includes: cars with a weight of less than 6,000, except mortuaries, trucks and light commercial or delivery cars, which are qualifying cars not for individual use; other property used for shipping needs, except for light commercial or light commercial vehicles, which is used for transporting passengers or goods; other property, which is used for shipping needs, except for light commercial or light commercial vehicles, except for lorries, busses, boats, aircraft, motorcycle and any other vehicle used for the carriage of passengers or goods; and charges associated with the use of listed property are not deducted as commercial expenditure.
This means that a taxpayer has to prove the economic use of a property if he wants to write it off or subtract expenditure. Prevailing use test specifies that in order to make a demand for a premium write-off, a choice affecting expenditure or a write-off of the property according to the Modified Accelerated Cost Recovery System (MACRS), the economic use of the listed property must amount to more than 50%.
When a listed property is mainly used for commercial purposes, it is subjected to the legal proportional amortization rate, as in this case it is to be regarded as an economic good. Properties protected as historical monuments which are at most reasonably necessary for operation (and which pass the prevailing usage test) can still be written off, but must be written off using the straight-line method. However, listed properties which are at most reasonably necessary for operation (and which pass the prevailing usage test) can still be written off using the straight-line methods.
Vehicles used exclusively for the carriage of persons are also subjected to further restrictions on their value. Properties protected as historical monuments which do not correspond to the prevailing use test are excluded from the application of 179 depreciations or other expedited depreciations method. Recurring write-downs can be reversed through profit or loss in any year after the first year of use in which the use of the listed real estate transaction falls below 50%.
This means that the tax payer may have to repay some of the surplus amortization required. Recovered amortization is the expedited amortization permitted for the years prior to the recovery year, inclusive of expenses under 179, less the amortization amount of the MACRS Alternative Depreciation System (ADS) that would have been permitted for the same accounting year.