I:6-35 Capitalization vs. Expense. Sam owns a small apartment building (this is the only rental building Sam owns). During the year Sam incurs the following expenditures:

Item Amount Replace roof and roof underlying structure because of building code requirements

$30,000 Repaint the interior 3,000 Repair door handles and door locks 1,000 Replace three broken windowpanes 1,500 Replace crumbling sidewalks and stairs because of building code requirements 25,000 Discuss the proper tax treatment for these expenditures.