Where do I itemize upgrades done to rental property?

[SobotkerS]

had new roof placed on rental property in 2016. had central a/h installed also. is this deductible if payments are being made on AC?

[AnnetteB · Accepted solution]

Both the roof and the air conditioning unit would be entered as assets to be depreciated for your rental income and expenses. 

Even though you are making payments on the air conditioning unit, you would enter the total cost as the basis for depreciation.  By depreciating the total cost, you would not claim the payments for the unit as an expense.  You would only be able to claim any interest amounts made with the payments.

If you are just starting to enter your rental information, TurboTax will take you through many preliminary screens and questions to record the details about your rental.  Then you will finally come to a screen that is titled “Review Your ____ Rental Summary”.   From this screen you can choose the section to visit next.  Your choices are Rental Income, Expenses, Assets/Depreciation, and Vehicle Expenses. 

To add these items as Assets, use these steps:

• Click Start or Update next to Assets/Depreciation

• Again, there may be some preliminary questions to answer

• When you reach the Your Property Assets screen, click the blue Add an Asset button

Once the asset has been entered, you can always choose to Edit the details from the Your Property Assets screen, or even Delete the asset and enter it again.