Harry owns a condominium unit in a condominium office building used exclusively in his consulting business. The condominium unit contains two restrooms for clients. In 2020, he pays $40,000 to renovate and improve the bathrooms. He replaces the tiles, bathtubs, sinks, toilets, pipes and other bathroom fixtures. Harry paid $30,000 for labor and $10,000 for materials for the renovation. How should Harry treat his expenditures in 2020?

a. Harry must expense the $30,000 for labor and capitalize the $10,000 for materials b. Harry must capitalize the entire cost of $40,000 c. Harry must expense the entire cost of $40,000 d. Harry must capitalize the $30,000 for labor and expense the $10,000 for materials e. Harry may expense the entire cost of $40,000 but only if he made the de minimis safe harbor election