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When to start depreciation of capitalized improvements on rental property?
11/3/09 5:11 AM, Viewed by asker 11/3/09 11:14 AM
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Total Views: 44
My client spent $25k on capital improvements spread out over two years (kitchen appliances, baths, interior walls, related painting, etc.). Would the entire project be considered "placed in service" in the 2nd year and we start depreciation in 2nd year, or how else would you depreciate? Thanks! Theresa
All Replies: Answers (2)
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11/3/09 6:23 AM
The appliances would not be lumped in with the capital improvements. The new appliances and the other capital improvements are considered in service when the home is ready for renting - in other words the property is ready to produce income..
You must be the change you want to see in the world-Mahatma Gandhi (1869-1948)
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11/3/09 6:35 AM
I agree with Mimbreno, you're lumping some apples with oranges. So the depreciation methods would be different, but the starting point would be the same, that is when the place is in move-in condition.
Outside of a dog, a book is man's best friend.
Inside of a dog, it's too dark to read.
~Groucho Marx
Inside of a dog, it's too dark to read.
~Groucho Marx
