Special depreciation for rental property

[DanCarrier]

I replaced three of eight windows on my rental house in 2023 for ~$4500.  Are these three windows eligible for special depreciation?

[DianeW777]

No, they are considered part of the structure and would be considered as a capital improvement depreciated over 27.5 years.  Do not enter then as an asset until you see the next section. There is a possibility you could qualify to deduct the full expense under Safe Harbor Election for Small Taxpayers.

Here are the rules you need to meet to take this election for your windows:

• Your gross receipts, including all your other income, are $10,000,000 or less.
• Your eligible building has an unadjusted basis of $1,000,000 or less.
• The cost of all repairs, maintenance and improvements is less than or equal to the smallest of these limits:
  • 2% of the unadjusted basis of your building (before any depreciation) or
  • $10,000

 If you find you do qualify for this option and you want to take the full expense in one year for the windows, use the steps below to enter it in your return. 

1. When you come to the screen, Did you buy any items that each cost $2,500 or less in 2023? mark the No button and click Continue.
2. On the screen Let's see if you qualify to deduct these items as expenses, mark both of the Yes buttons and click Continue.
3. On the Now, let's review each item you bought screen, mark whether all your new assets cost $2500 or less.
4. If you mark that every item cost $2,500 or less, you will be brought to the Rental Summary screen.  You have elected the De Minimis Safe Harbor provision.
5. If you mark that some cost above $2,500, you will be asked Did you make improvements to rental in 2023?
6. If you say Yes, you will be taken through the screens for the Improvements election.
7. If you say No, you will see the screen Do you have any items that aren't covered by your elections?  Proceed through the screens to enter these assets.
8. On the Rental Summary screen go to the Expenses section and click on the Start/Update box.
9. Continue to the Any Other Expenses? screen and enter the description and amount paid for the assets. Click Continue when finished.

[AmeliesUncle]

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@DanCarrier wrote:

I replaced three of eight windows 

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Three of eight, I would deduct at a "repair".