If I spend less than $2,500 when building a shed, can I avoid depreciating it?

Yes. You can deduct the business portion of any item costing $2,500 or less in one year - do depreciation. If it costs more than $2,500 and is not permanently attached to the land, you can still deduct it in one year. If it is permanently attached to the land you must depreciate it over 39 years.