Which asset category when adding depreciation asset—there are only three categories but….

[Rlk508]

Trying to enter expense of residing rental home. Since it’s an asset that will be depreciated trying to figure out which category to select so I can enter expense. Three options: A. Residential real estate B. Appliances carpet furniture C. Land improvements. It’s not new real estate so A. doesn’t fit but neither do any of the other categories. It’s unnecessarily difficult. I don’t want to pay $80 to answer one simple question. The interface is not helpful. Any suggestions?

[Carl]

What specifically are you entering as an asset? At a minimum you will list the property itself which is classified as residential rental real estate. Or is this "not" residential? Maybe it's commercial using as a storefront you own that you are renting out?

[Rlk508]

Residing of rental home. These are the options on the page where I’m stuck. If I select the first option below it’s only about purchase of new real estate which makes zero sense. Other two options are not related to “residing expenses.”

Tell Us a Little More About Your Rental Asset

this asset

How would you categorize this asset?

Residential Rental Real Estate Appliances, carpet, furniture Land improvements

[Carl]

What do you mean by "residing of rental home" ???
If you're renting it out then it's residential rental real estate. It doesn't matter if you purchased it 50 years ago and lived in it as your primary residence until you moved out and converted it to a rental in 2024.

[M-MTax]

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@Rlk508 wrote:

If I select the first option below it’s only about purchase of new real estate which makes zero sense. 

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The real estate does not have to be "new".

If you converted existing real estate to rental (or business) use, then you would select Residential Rental Real Estate.

[Rlk508]

Thanks but no thanks. You’re totally on the wrong path with your answer. This “community” is not helping.  Waste of time.

[abrdfd]

I am also trying to understand this.  It may help to express what item you are trying to categorize. 
I have read some threads on bathroom remodels with conflicting information on this topic.  One said that bathrooms are listed under Appliances, carpet, furniture as they are wear items within the building, while another said that it is Real Estate Property as it is considered a permanent improvement.  Apparently the Real Estate Property category depreciates items over 27.5 years whereas Appliances, etc. is 5 years due to being considered non-permanent.  I am in the process of trying to figure out where a recent insulation project gets categorized.  I similarly thought that Real Estate Property makes no sense as it asks you to enter a physical address.  I am sorry I don't have an answer but wanted to provide a response to a good question!

[M-MTax]

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@abrdfd wrote:

Apparently the Real Estate Property category depreciates items over 27.5 years whereas Appliances, etc. is 5 years due to being considered non-permanent. 

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Correct, and if it is a structural improvement to the property (e.g., a new roof, kitchen or bath remodel, et al) that exceeds the $2,500 de minimis safe harbor, the asset is added in the real estate category with a recovery period of 27.5 years for residential rental property.

Frankly, I'm not sure why this question was asked and/or an answer was not accepted. This issue is well-settled. See https://www.irs.gov/publications/p527#en_US_2024_publink1000219079

[abrdfd]

Thank you.

I found conflicting answers from this site's "tax experts" on the same subject which started me down this path.
The following thread answered a bathroom remodel as "appliances, carpets, furniture".  Lots of misinformation to weed through. 

https://ttlc.intuit.com/community/taxes/discussion/re-asset-depreciation-category/01/3302149/highlig...

[M-MTax]

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@abrdfd wrote:

I found conflicting answers from this site's "tax experts" on the same subject which started me down this path.
https://ttlc.intuit.com/community/taxes/discussion/re-asset-depreciation-category/01/3302149/highlig...

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Yeah, the first answer in that thread is simply wrong with respect to a bathroom remodel. Unless the project can be deducted under the de minimis safe harbor ($2500 or less), the cost of the project would be capitalized as residential real estate, not "appliances, carpet, and furnishings".