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What does "Allowance" mean on the Materials List report?

Disclaimer: FlipperForce does not provide tax, legal, or accounting advice. This report and FAQ are for informational purposes only and should not be soley relied upon for tax compliance. Because IRS rules are complex and subject to change, we strongly recommend consulting with a qualified tax professional or accountant before making business decisions or filing returns.
Allowance is a

Allowances are often used as a "plug #" to cover an anticipated cost for material selections that have not been finalized.

Example

A house flipper might know they want to replace the vanities in the house, but they aren't sure which specific vanities they are going to use so they just plug in a $750 "allowance" for the vanities which they know is adequate to buy a reasonably priced vanity for the project.

Allowances on the Materials List Report

The Materials List Report automatically identifies the "allowances" on your project if there has not been a material selected for the repair item.

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