Large HOA assessment for my rental unit, where to plug in the number?

[JJ_1]

The building where my rental unit is went through a massive renovation and I paid my portion in one shot, of 40k.

They were renovating the lobby, hallways on all floors, new elevator, plumbing pipes, etc.

Where do I plug this in? Can I just add it to "Maintenance?" 

Thank you.

[LeonardS]

No, you can not just add it to "Maintenance".  In general, maintenance is something that you would do to maintain the rental unit at a basic level.

These massive renovations are capital improvements and will be added to your basis of your rental unit.

 A capital improvement is something that actually adds to the value of the home or increases its usefulness.  Some examples of capital improvements are:

• Remodels and room additions (including decks and porches)
• New or upgraded landscaping, irrigation, sprinkler system
• Hardscape such as pavement, block or retaining wall, patio
• Fencing
• Swimming pool, spa
• Storm windows, doors
• New roof
• Central vacuum or security system
• Upgraded wiring, plumbing, ductwork
• Central heating, AC, humidifier
• New furnace, water heater
• Filtration, soft-water, or septic system
• Built-in appliances
• New flooring or wall-to-wall carpeting
• Upgraded insulation
• Satellite dish

[JJ_1]

Thank you, @LeonardS. 
I still don't know exactly where to put this. Would it be considered an asset? Should I add it under my rental asset list?

[JJ_1]

@LeonardS, I'm also planning on selling this rental property this year. should I take the 179 deduction or spread the deduction over several years?

[ColeenD3]

Yes, you would include this as an asset. You would have to depreciate it over its useful life, which is 27.5 years. There is no Section 179 for real property.

[JJ_1]

Hi @ColeenD3, how do I categorize each of these expenses I had?

pool/spa/structure repair

plumbing

elevators/generator/fire & life safety/access

renovation

contingency (10%)

The options TurboTax shows me are:

- Rental Real Estate Property

- Computer, Video, Photo and Telephone Equipment

- Tools, Machinery, Equipment, Furniture

- Intangibles, Other property

Appreciate the help. Thanks.

[PattiF]

You will enter these items as improvements that will be depreciated. When you sell the property, all of the unused depreciation will be added to your rental property and you will have the tax benefit of the expense. The contingency would be entered as an expense to deduct for the year instead of as a depreciable item.

After the ordinary income and expenses are entered, you will see the Rental Summary screen.

• Select Start next to Asset/Depreciation and follow the online instructions to enter the depreciable improvement expenses. These will all have the same depreciation life of 27.5 years.

The expenses that you listed in your last response are all Rental Real Estate Property as they are all improvements to the rental property. 

This TurboTax help article has more information about capital improvements and depreciation for your rental property along with additional links.

[JJ_1]

@PattiF , which category do I pick for these? 
The options are:

Residental Rental Real Estate

Appliances, Carpet, Furniture

Land improvements

Then it asks when I acquired it, I'm putting the date I paid for it. 

[ColeenD3]

@JJ_1 It is Residental Rental Real Estate.