Investors & landlords
HVAC is considered part of the house and depreciated over the life of the house. Enter it as another asset, just like the house.
You want to reply that this is just a part of the AC and just a repair. It sounds like you are restoring the system to use from what you described.
This is section 162 and does not qualify for bonus depreciation under sec 168.
The IRS has issued Tangible Property Regulations - Frequently Asked Questions which states in step 2:
A unit of tangible property is improved only if the amounts paid are:
- For a betterment to the unit of property; or
- To restore the unit of property; or
- To adapt the unit of property to a new or different use.
Pub 527 for Rental Property states:
Repairs and Improvements
Generally, an expense for repairing or maintaining your rental property may be deducted if you aren’t required to capitalize the expense.
Improvements. You must capitalize any expense you pay to improve your rental property. An expense is for an improvement if it results in a betterment to your property, restores your property, or adapts your property to a new or different use. Table 1-1 shows examples of many improvements
The expenses you capitalize for improving your property can generally be depreciated as if the improvement were separate property.
These do not qualify for safe harbor.
