TurboTax FAQ
TurboTax FAQ
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What is rental depreciation and how does it differ from an expense?

Depreciation lets you deduct the "used up" portion of an asset's cost year after year, until the entire cost is used up or you no longer own it. It allows for wear and tear or obsolescence of the property or asset.

Depreciation deducts the asset's cost over time rather than deducting it all at once, as you would when deducting an expense.

Rental property is considered a depreciable asset, as are major improvements such as new roofs, landscaping, refrigerators, water heaters, furniture, and so forth.

On the other hand, expenses are used to deduct the entire cost of services, utilities, fees, and consumable items (cleaning supplies, light bulbs, smoke alarms and batteries, etc.).

TurboTax Premier, TurboTax Live Premier, TurboTax Self-Employed, and TurboTax Self-Employed Live (and Home & Business if you're using TurboTax CD/Download) will help you handle the ins and outs of depreciation. We'll even figure out which depreciation method gives you the biggest tax break, based on your particular situation.


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