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February 14, 2025
Question

Rental Assets

  • February 14, 2025
  • 1 reply
  • 0 views

Hi,

 

I made two improvements to my rental property last year.  I added a minisplit air conditioner for the house and added gutters. Since these are both assets that will be depreciated, I trying to figure out which category to select so I can enter expense. Three options: A. Residential real estate B. Appliances carpet furniture C. Land improvements.

 

Thank you

    1 reply

    Carl11_2
    Employee
    February 15, 2025

    Since the improvements are "a material part of" the structure they are classified as residential rental real estate and depreciated over 27.5 years.

    If the improvements were less than $2,500 then you can elect to expense them under the safe harbor de-minimus act. For a brief explanation see https://www.landlordstudio.com/blog/3-irs-safe-harbors-landlords-need-to-know-about