Question

Expenditures made for ordinary repairs and maintenance of property are not added to the original basis in the determination of the property's adjusted basis whereas capital expenditures are added to the original basis. True or false?

Answer 1

True

Step-by-step explanation:

Expenditures is the expenses made over the course of an action inorder to achieve the desired results. In maintenance of a property, the expenditure could be for ordinary repairs (plumbing, painting, minor electrical repairs) or capital expenditures ( house renovation, major electrical wiring, house re-modelling e.t.c ).

It is true that, ordinary repairs and maintenance of a property are not added to the original basis in the determination of the property's values as a result of the level of financial expenses carried out.