Last year I put in brand new vinyl plank flooring in the basement of my rental property and depreciated the cost over 7 years but tenants ruined the floor in 6 short months and it had to be torn out and re-done with completely new material after they were evicted. Is there a way to remove the floor from my depreciated items since it is no longer in service, but still receive "credit" for the expense? I tried taking the item out of service on Turbo Tax but it did not change my amount due, so do I just have to eat the cost of that?
You can dispose of the asset (as you did) and indicate the date of the disposal. Depreciation will be calculated up to the disposal date.
Then add the new flooring asset and begin depreciating it over its useful life.
There are remedies in court (but not on your taxes) for damages a tenant may cause to your property beyond what you hold for their deposit. If the costs were considerable, this can be your best solution. Garnishments can also be pursued for judgments in your favor in order to collect what is owed to you.
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