When a taxpayer with average annual gross receipts in excess of $25 million finances the construction of its building by borrowing, the interest is added to the cost of the building.

Question

Quizplus · Accepted Answer

According to the IRS, when a taxpayer with average annual gross receipts in excess of $25 million finances the construction of its building by borrowing, the interest is added to the cost of the building. This is known as capitalized interest and can be deducted over the life of the building through depreciation.

When a Taxpayer with Average Annual Gross Receipts in Excess