Rental Carpet Depreciation

[travis bickle]

Hi,

I was rushed Friday at the office when I had an elderly client drop off some paperwork about his rental property. One thing caught my eye - Carpeting $1,092 [he replaced the carpeting in one room]

At first I thought "I know I am supposed to depreciate this -- but as carpeting in a leased residential place it has a life of 5 years."

I find it hard to believe that I have to depreciate this small amount for 5 years; I know I cannot §179 it. But am I right, MUST I depreciate it?

TTB is in my office, waiting for me Monday morning -- your thoughts are appreciated.

[Jiggers]

Rental carpet expense

Would this be normal repairs and maintenance, to keep it rentable?

I could see replacing the carpet everytime the renter moved out, especially if there were kids or a wild bunch!

[Jesse]

I don't think you have a choice. The carpet should have a life of more than 1 year, if you had to replace it again before the end of depreciation cycle you would need to take the remaining deduction in the year it is totally destroyed.

[taxea]

Rental Carpet Depreciation

This is like changing a light bulb...if you carpet the entire house or normal carpeted area, it is depreciated (increases the value of the house). If you replace one room you are repairing/maintaining. taxea

[Zee]

This is like changing a light bulb...if you carpet the entire house or normal carpeted area, it is depreciated (increases the value of the house). If you replace one room you are repairing/maintaining. taxea

And, how would you support this argument to win under audit?

[taxea]

Rental Carpet Depreciation

Like I said, if it increases the value of the house it is a depreciated item. If it is normal maintenance, it is a repair. The difference is the same as patching a roof as opposed to reroofing. taxea

[Zee]

Like I said, if it increases the value of the house it is a depreciated item. If it is normal maintenance, it is a repair. The difference is the same as patching a roof as opposed to reroofing. taxea

I don't think it's quite the same as patching a roof, or patching a carpet. Adding one room of carpet adds value, two rooms more value, the entire apartment more value. The value simply increases with the amount of carpet installed. But, I'm sure others would agree your argument is reasonable, especially if the cost is minimal.