Ask the Accounting Community

Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
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Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
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Being a former Property Tax Assessor, I would think you would expense the street assessment fee as is is already apportioned with principle and interest as a fee on the tax bill.

I used to apportion the water assessments to create a fee schedule to determine amounts to add to the tax bills.

This is my opinion, I am not sure if it is correct.

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Lynn Roy
Other
Parsons Brinckerhoff
Detroit MI
United States
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Original Message:
Sent: 05-22-2012 02:55 PM
From: Kerri Bennett-Groff
Subject: How to account for street assessment


Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
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Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
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Carol Lizak
Controller
United States
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I agree to expensing and not capitalizing it; equivalent to Cost of Area Maintenance (CAM).





Original Message:
Sent: 05-23-2012 08:16 AM
From: Lynn Roy
Subject: How to account for street assessment

Being a former Property Tax Assessor, I would think you would expense the street assessment fee as is is already apportioned with principle and interest as a fee on the tax bill.

I used to apportion the water assessments to create a fee schedule to determine amounts to add to the tax bills.

This is my opinion, I am not sure if it is correct.

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Lynn Roy
Other
Parsons Brinckerhoff
Detroit MI
United States
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Original Message:
Sent: 05-22-2012 02:55 PM
From: Kerri Bennett-Groff
Subject: How to account for street assessment


Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
-------------------------------------------
Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
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Expensed. 

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Angelo
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Original Message:
Sent: 05-23-2012 08:16 AM
From: Lynn Roy
Subject: How to account for street assessment

Being a former Property Tax Assessor, I would think you would expense the street assessment fee as is is already apportioned with principle and interest as a fee on the tax bill.

I used to apportion the water assessments to create a fee schedule to determine amounts to add to the tax bills.

This is my opinion, I am not sure if it is correct.

-------------------------------------------
Lynn Roy
Other
Parsons Brinckerhoff
Detroit MI
United States
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Original Message:
Sent: 05-22-2012 02:55 PM
From: Kerri Bennett-Groff
Subject: How to account for street assessment


Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
-------------------------------------------
Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
-------------------------------------------

www.irs.gov

Search for Publication 535 (Business Expenses)

Page 16  "TAXES FOR LOCAL BENEFIT"
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Joseph Callahan
Accountant
Osceola PA
United States
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Original Message:
Sent: 05-22-2012 02:55 PM
From: Kerri Bennett-Groff
Subject: How to account for street assessment


Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
-------------------------------------------
Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
-------------------------------------------

Kerri,

I would expense it and not activate it. These are periodically recurring costs, activating them would make things only more complicated. If you want, you might want to 'pre-book' them as a monthly accrual against which you book the costs once they are billed.

Peter

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Peter Strucks
Director/Manager
Spectris Pte Ltd
Singapore
Singapore
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Original Message:
Sent: 05-23-2012 08:53 AM
From: Joseph Callahan
Subject: How to account for street assessment


www.irs.gov

Search for Publication 535 (Business Expenses)

Page 16  "TAXES FOR LOCAL BENEFIT"
-------------------------------------------
Joseph Callahan
Accountant
Osceola PA
United States
-------------------------------------------






Original Message:
Sent: 05-22-2012 02:55 PM
From: Kerri Bennett-Groff
Subject: How to account for street assessment


Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
-------------------------------------------
Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
-------------------------------------------

I have always expensed it. 
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Pete Busicchia CPA
Executive Officer
Youth & Family Centered Services, Inc
Austin TX
United States
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Original Message:
Sent: 05-22-2012 02:55 PM
From: Kerri Bennett-Groff
Subject: How to account for street assessment


Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
-------------------------------------------
Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
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Benjamin Feutz
Other
INTERNAL REVENUE SERVICE
Dover OH
United States
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Pete,
Is this a recurring cost?  If this is a recurring cost and not large, over 5K, I would expense.  As the cost is for city property, you have nothing to capitalize it to.
Please understand that my position does not bind the government, but I would treat the cost under IRC 162.





Original Message:
Sent: 05-24-2012 11:49 AM
From: Pete Busicchia
Subject: How to account for street assessment


I have always expensed it. 
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Pete Busicchia CPA
Executive Officer
Youth & Family Centered Services, Inc
Austin TX
United States
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Original Message:
Sent: 05-22-2012 02:55 PM
From: Kerri Bennett-Groff
Subject: How to account for street assessment


Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
-------------------------------------------
Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
-------------------------------------------

Kerri,

Based upon an old Revenue Ruling from 1979 it appears if the charges are broken out  between the construction amount, interest and taxes then you will capitalize the construction amount and expense the remainder.  I would take the position if the charge is not detailed, that it relates to the bond interest charges from the county and all is expensed.

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Allan Lyons
Corporate Officer
SQUIRE SANDERS & DEMPSEY LLP
Stow OH
United States
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Original Message:
Sent: 05-22-2012 02:55 PM
From: Kerri Bennett-Groff
Subject: How to account for street assessment


Does anyone know how to account for street assessments.  As an example, if your company pays the city for curb and gutter do you capitalize or expense it?  Any other way to report it?
-------------------------------------------
Kerri Bennett-Groff
Accountant
Crop Production Services
Windsor CO
United States
-------------------------------------------