Is an airconditioner for a rental property considered an appliance or machinery?

[cindyk0713]

We purchased a new air conditional for a rental property. Where do I enter the purchase? If I enter under Real Estate Property, do I then show it as Residential Rental Real Estate or as Appliances, Carpet, Furniture?

[DS30 · Accepted solution]

It depends -

If the unit is a permanent capital improvement - the list as an asset under residential rental real estate and depreciate it over the remaining life of the rental house.

If this unit is a window type unit that can be removed - list it as an appliance.

A "capital improvement" to your home, meaning the improvement must increase your home's value, adapt it to new uses, or extend its life. Examples of capital improvements are: adding a third bedroom, adding a garage, installing insulation, landscaping and more.

To enter rental information in TurboTax, log into your tax return (for TurboTax Online sign-in, click Here and click on "Take me to my return") type "rental income and expenses" in the search bar then select "jump to rental income and expenses". TurboTax will guide you in entering this information.