Characterizing repair expense from cash back at closing

I received $1000 cash back at closing (in the closing balance sheet) towards a $1500 attic mildew remediation quote resulting from finding during a home inspection. How do I categorize this cost as a cost of acquisition rather than a later repair that goes against cash flow?

@david2 Thanks for your question. Stessa is built to be flexible enough to handle different income and expense situations, but we do not provide specific tax advice. You’ll want to check with your CPA for more information about how to handle this scenario. What we can say is that generally speaking, it’s often to your advantage to categorize something as a repair vs a capital expense or closing cost, since that allows you to expense 100% of the cost in the year incurred. That said, the IRS rules dictate where the line is between a repair and a capital expense, so only a qualified CPA can give you a definitive answer.