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Level 4
January 3, 2024
Question

Deduct or Depreciate Improvements?

  • January 3, 2024
  • 3 replies
  • 18 views

Hello, in 2023, I remodeled a bathroom in a rental property, and the cost for this improvement was approximately $10,150.  Is it correct to deduct this as an expense, rather than depreciate it as an improvement?  

 

I did review the "add an asset" section of Turbo Tax to consider adding it as an asset to be depreciated, but none of the choices seem to fit.

 

Ryan

3 replies

Level 15
January 3, 2024

It would be appropriate to recover the cost of the remodel through depreciation deductions.

 

You would add the cost as an asset in the program and select residential real estate since the recovery period would be 27.5 years, the same as the underlying property.

rynleeAuthor
Level 4
January 3, 2024

Okay, but then it asks for the cost of the land.  How can I determine this?

Critter-3
Level 15
January 3, 2024

Land is not material for improvements ... enter a zero.