I know that rent would fall into Facilities expense but would utilities be consider also?

I'm looking at a tax-return...

2 Answers

  • 1 decade ago
    Favorite Answer

    Normally utilities (electric, heating fuel, phone, etc.) go into a separate account titled Utilities Expense. It's easier to track changes in the utility bills when they are separate (which holds true for all expenses, really). But, some people do put utilities in with Facilities Expense. They may also include janitorial expenses in Facilities Expense, as well.

    On a tax return, the key is consistency. If utilities were reported in Facilities Expense for the last 2 or more years, you may want to leave them there. A large increase or decrease in a line item on a tax return can often trigger an audit by the IRS or other taxing authority.

    Source(s): BS in Accounting and over a decade of experience in CPA firm.
  • 1 decade ago

    Usually, utilities (electric, gas, etc.) would be part of your responsibility. However, if the owner wants/needs to get the building occupied (if its been on the market for a period of time), s/he may be open to negotiations as to the utilities.

Still have questions? Get your answers by asking now.