To add the new HVAC as a new Asset for Depreciation from the summary page of your Rental Property follow these general steps (assume Continue after each step):
- Click Update beside Assets/Depreciation, then say Yes.
- Below the list of Property Assets, click on Add an Asset at the left.
- Choose Rental Real Estate Property >> Residential Real Estate.
- Enter a description like "2021 HVAC," the cost, skip land cost, and enter the date the HVAC was turned on.
- Check the box for "I purchased this asset" then "Yes, I've always used this item 100%..." and enter the date you turned it on.
- Click the box for "Show Details" to see how the depreciation expense was calculated.
Note that residential real estate does not qualify for accelerated depreciation (ie: Section 179 deduction nor Special Depreciation). See IRS Pub 946 for more information.
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