With construction, no other mutual bond has such a high dependency on each other as the contractor subcontractor relationship. If the relationship is developed properly and with a mutual understanding, it can be very successful.
There are two exceptions allowed for small business residential contractors to escape the requirements of Section 263(a) – Capitalization of Overhead. The first is the $10,000,000 in sales per year threshold. The second exception is allowed for contractors that build residential homes and are able to complete the contract within two years.