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Can I use a special depreciation allowance for a new roof for a rental property?

Forum|Forum|6 years ago
June 7, 2019
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I own a condo that I rent out. At the end of last year the roof for the entire building was replaced. I input this information into Turbotax and it ask me if I'd like to use a special depreciation allowance and deduct the entire expense this year. From what I've read about this special depreciation allowance it doesn't seem like I should be able to, instead I should have to depreciate it over a period of 27.5 years. Can I use the special depreciation allowance?

Additionally I had the condo appraised last year in order to remove PMI (the condo has gone up significantly in value). I did not refinance. Is the cost for the appraisal deductible as an expense?

TurboTax Home & Biz Windows

Best answer by MichaelDC

No. The IRS has taken a very strong position that a new roof must be capitalized and depreciated.

You will report it as an asset depreciated over a period of time rather than deduct it a a current year expenses. (should be depreciated over 27.5 years , the same recovery period as of the property ) Also see answer from below and attached image ( the very last row of table 2.1 )

Please feel free to post any additional details or questions in the comment section.

https://ttlc.intuit.com/replies/4791833

K

keithneargarder

I understand some items like a new roof, remodel, etc. that you do once every 25+ years not qualifying, but how is it that a water heater (from my experience life expectancy of 10-15 years) and a furnace (life expectancy 15-20 years) not qualify? You will most likely be replacing them well before you have fully depreciated them.

M

MichaelDCAnswer

Employee

No. The IRS has taken a very strong position that a new roof must be capitalized and depreciated.

You will report it as an asset depreciated over a period of time rather than deduct it a a current year expenses. (should be depreciated over 27.5 years , the same recovery period as of the property ) Also see answer from below and attached image ( the very last row of table 2.1 )

Please feel free to post any additional details or questions in the comment section.

https://ttlc.intuit.com/replies/4791833

M

mavmoses07Author

Thanks! What about the condo appraisal?

T

TSK2264

Since this was purchased 8 years ago, accelerated depreciation rules would not apply. However, for anyone that has been directed here from doing a similar search on the tax treatment of a new roof on a rental property, a new roof would qualify for accelerated depreciation if the property was put into service after 12/31/2017.