Oh @sviyer ... another thing to consider is that you could use sec 179 to deduct the rental portion that would normally be depreciated. Sec 179 allows you to deduct a certain amount of otherwise depreciatable assets, subject to various limitations (which I am not up to date on).
Enter the water heater as you would any other asset and look for TT to ask about "sect 179 expensing"
See this article for some more info
https://www.nolo.com/legal-encyclopedia/section-179-expensing-rental-property-owners-deduct-long-ter...
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