Rental property - replacing appliances

Forum|Forum|3 years ago
October 15, 2022
1 reply
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I am seeing two ways on how to deduct appliances for a rental property. i am first seeing that you can deduct the full cost of the appliances providing they do not exceed the total of $2,500. I am also seeing that you can expense it over the life, which is 5 years.

The rental property is in need of some new appliances and was considering replacing some of them in 2022 and some in 2023 as to not throw a red flag since the expenses over the past few years have been minimal. However, the total of the appliances will probably be around $2,000 or less.

Is there a preferred way to avoid red flags by the IRS and a potential audit?

Thank you

Carl11_2

Employee

You can do either. If the invoice item is less than $2,500 then I would recommend you just expense it. Otherwise, when you sell the property or need to replace the appliance(s) again, you have to deal with the depreciation stuff.

Understand that you can replace (for example) $8,000 worth of appliances in the same tax year, and still expense them. If the invoice shows the cost of each individual appliance, and that cost for each appliance is clearly shown on that invoice and it's less than $2,500, then you can expense that appliance.