Great question! The answer is yes.
The price is rarely a disqualifying factor in these cases, since it’s hard to make a chicken coop “lavish or extravagant.”
The bottom line is that you work with a farm that sells eggs or poultry and need a suitable home for your inventory. Investing in a high-quality structure is fair game in terms of tax write-offs.
However, you will probably need to report the house as a fixed asset on your business return and depreciate it over its useful life (typically seven or 15 years for single purpose farm structures).
The asset would also be eligible for Section 179 expensing and bonus depreciation if you wanted to claim 100% of the cost in the first year, but even if you use this option, it still needs to be listed as a fixed asset for the IRS to see.
No answer given yet!
Sarah is a staff writer at Keeper Tax and has her Enrolled Agent license with the IRS. Her work has been featured in Business Insider, Money Under 30, Best Life, GOBankingRates, and Shopify. She has nearly a decade of public accounting experience, and has worked with clients in a wide range of industries, including oil and gas, manufacturing, real estate, wholesale and retail, finance, and ecommerce. Sarah has extensive experience offering strategic tax planning at the state and federal level. During her time in industry, she handled tax returns for C Corps, S corps, partnerships, nonprofits, and sole proprietorships. Sarah is a member of the National Association of Enrolled Agents (NAEA) and maintains her continuing education requirements by completing over 30 hours of tax training every year. In her spare time, she is a devoted cat mom and enjoys hiking, baking, and overwatering her houseplants.