Sec 179 deduction for full value of bathroom rehab on SchE Rental Property showing profit

[Carl]

If this is residential rental real estate, then it flat out does not qualify for any SEC179 deduction. At best, you can only take the "special depreciation allowance" which is not the same as SEC179.

See IRS Publication 946 page 16 at https://www.irs.gov/pub/irs-pdf/p946.pdf

Now if this is commercial rental property and this is a leasehold iprovement, different rules apply. But for residential rental property that you own, you flat out can not take a SEC179 deduction per Pub 946.

[ColeenD3]

Qualified section 179 real property.

For property placed in service in tax years beginning after 2017, qualified section 179 real property is qualified improvement property (as defined in section 168(e)(6)), and certain specified improvements to nonresidential real property placed in service after the nonresidential real property was first placed in service

Q4: What is Qualified Improvement Property (QIP) and does it meet the requirements for first year depreciation deduction?

A4: The PATH Act of 2015 created a new category of real property known as QIP for purposes of the additional first year depreciation deduction. The term “qualified improvement property” means any improvement to an interior portion of a building which is nonresidential real property if such improvement is placed in service after the date such building was first placed in service by any person.  However, QIP does not include any improvement for which the expenditure is attributable to: the enlargement of the building; any elevator or escalator, or the internal structural framework of the building.   

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