I own a rental property. I had to replace the furnace in 2019. I'm paying for it on a 12 month payment plan. Should I deduct the full amount or only the payments made

[Anonymous]

the full amount but not including any unpaid interest

you may want to consider the small taxpayer's safe harbor election

see this link

https://www.nolo.com/legal-encyclopedia/small-taxpayer-safe-harbor-for-repairs-improvements.html

[Carl]

You claim the full amount you are contracted to pay. Generally, that does not include interest. Interest is deducted only in the year it's paid, and only in the amount paid for a specific tax year.

If the furnace was a replacement for an existing furnace you should consider deducting it as an expense under the safe harbor act referenced earlier in this thread.

Otherwise, if the furnace does not qualify for safe harbor you'll enter it as an asset and it gets depreciated over 27.5 years since it is in fact, a physical part of the structure now.