Rental property

[chung113581]

I have questions about my property rental, The property depreciation is 30 years over, can I redo the property depreciation again on different value.?

[jtax]

What do you mean "is 30 years over?" 

Do you mean you have fully depreciated the property? I.e. For residential realty it has been more than 27.5 yrs since it was put into service?

If so, you cannot start it "over again." You could however start depreciating improvements to the property starting with the date they go into service (e.g. remodels, etc.).

Depreciation is done item of property by item of property. So the building itself is one thing. Rental appliances (fridge, dishwasher, etc.) are each a different thing with a different time period (life) for depreciation. It is typical to have a bunch of assets associated with a rental/business property that are depreciated over different time periods and are at different points. The asset history reports keep all the detail for you. (You enter each asset in TT and it keeps track of  the depreciation over the years).

[Chung11358]

Yes, the property fully depreciation for 27.5 years.  Can I deduct onetime expense small items like buy "porcelain tile for bathroom" etc..instead do depreciation?

Thanks for your help

[jtax]

That is always a tricky question. But the bottom line is you should be able to expense those kind of expenses though you may need to make an election for a de-minimis safe harbor.

When you do through the TT rental property interview, under the assets/depreciation section, you will be asked about small improvements or total improvements < $10k/2% of your basis, and if you qualify TT will make the election for you. E.g. if you say you have depreciable improvements > $2.5k you will get this screen:

For background info see these references

https://www.nolo.com/legal-encyclopedia/tips-maximizing-repair-deductions.html

which says in part (repairs are deductible, improvements must be depreciated).

What is the Difference Between a Repair and an Improvement?

Here's the basic rule from the IRS: An expense is for an improvement if it:

• makes a long-term asset much better then it was before
• restores it to operating condition, or
• adapts it to a new use.

In contrast, expenses you incur that don't result in a betterment, restoration, or adaptation are currently deductible repairs.

There is also a "de-minimis safe harbor" that you probably qualify for. details:

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

this describes the safe harbors

https://ttlc.intuit.com/community/investments-and-rental-properties/discussion/re-another-question-r...