Investors & landlords


@Carl wrote:

 

Why? cleaning, maintenance and repair expenses aren't capitalized anyway. They're a fully deductible rental expense. So such thing as safe harbor for what is already a deductible rental expense.


 

No, IF it the situation qualifies (if ALL maintenance, repair AND these improvements are under the threshold), the improvements could be all deducted this year.

 

 

 


@Carl wrote:

 

Can I use Section 179?

No. Residential rental real estate and assets associated with it does not qualify for SEC179. However, it is perfectly possible for your new furnace and central A/C to qualify for the 50% Special Depreciation Allowance. That allows you to take a maximum 50% depreciation in the first year, with the remaining depreciated over the next 27.5 years.

 


 

Although the residential real estate does not qualify, the associated assets can now potentially qualify because the Tax Cuts and Jobs Act changes that.  However, in order to qualify, the rental would need to rise to the level of a "Trade or Business", which may not be the case.

 

No, it would not qualify for Bonus depreciation (which is now 100%).  Assets with a Recovery Period of over 20 years do not qualify.