Discussion:Life of a floor.

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Discussion Forum Index --> Tax Questions --> Life of a floor.


Rruth (talk|edits) said:

10 August 2006
Client has a home office. Client replaced floor in the home. What is the life of a floor? Since it is a home office, would it be residential (27.5) or commercial property (31.5)? Or can a floor be taken over five years similar to carpeting? (And yes, the floor covers the area used by the home office as well.)

Dennis (talk|edits) said:

11 August 2006
I vote 31.5 improvement. ♫

WesR (talk|edits) said:

11 August 2006
Hi agree with dennis would not be residential if home office. Assume floor is hardwood vs carpet. bye

LJACPA (talk|edits) said:

11 August 2006
Y'all are going too far back. Commercial property is now 39 years. For business property, carpeting is 7 year property. I'm not sure I agree with the 39 year life for flooring, was it the entire floor, i.e. subfloor, etc or just the flooring, e.g. tile, ceramic, etc. replaced? Regardless, when it comes to a home office, I try to take as little depreciation as I can possibly justify due to the potential gain on sale.

Taxstudent (talk|edits) said:

14 August 2006
You have to determine whether it is 1250 or 1245 property first, which is a facts and circumstances determination that is much harder than it should be. If it's 1250, then 39-year. If it's 1245, it could be five or seven year depending on where it falls in Rev. Proc. 87-56.

Deback (talk|edits) said:

14 August 2006
Here's an interesting article regarding the differences between 1245 and 1250 property:

http://www.fixedassetinfo.com/articles/Depreciation_Power_Lunch.asp

I believe floors are structural components of buildings (assuming the floor in question is beneath the tile or carpet), so 1250 property would be my answer - 39 years.

Rruth (talk|edits) said:

21 August 2006
Actually the floor is a Pergo type of stick on or laid on, just placed on top of the original hardwood, and easily removed. Can we go for 5 here?

LJACPA (talk|edits) said:

21 August 2006
Probably. I always use 7 year life on carpeting, flooring, etc. I'm conservative.

DZCPA (talk|edits) said:

21 August 2006
Anybody want to consider this a repair/maintenance and write off all at once?

ClA (talk|edits) said:

21 August 2006
I'd use 7 years. NO floor would last 30+ years.

Riley2 (talk|edits) said:

22 August 2006
Sounds like nonresidential real property to me. I would have a tough time arguing that a floor is personal property.

LJACPA (talk|edits) said:

22 August 2006
Are you serious? Copied this from a July 11, 2006 Field Director (for Casino construction costs, but I think it pertains generally).

Floor Covering

Includes  floor  covering that is affixed with permanent adhesive or nailed or screwed in place. Examples include ceramic or quarry tile, marble, paving brick, most vinyl coverings and other coverings cemented, mudded, or grouted to the  floor ; epoxy or sealers; and wood  flooring .
§ 1250
39 years

(40 years for purposes of § 168 (g))

Includes floor covering that is not permanently attached and not intended to be permanent, such as vinyl composition tile (VCT) installed with strippable adhesive, sheet vinyl, and carpeting, and located in the Casino area. Also includes floor covering that is not permanently attached associated with the activities described in Asset Class 79.0 of Rev. Proc. 87-56, such as Theater and Showroom.

§ 1245
7 years

And, this from a Cost Segregation memorandum

Floor Coverings

 Floor  covering affixed with permanent adhesive, nailed, or screwed in place. Examples include ceramic or quarry tile, marble, paving brick, and other coverings cemented, mudded, or grouted to the  floor ; epoxy or sealers; and wood  flooring .
1250
Building or Building Component –

39 Years

Floor  covering that is installed by means of strippable adhesives. For the retail industry, all vinyl composition tile (VCT), sheet vinyl, and carpeting will be treated as not permanently attached and not intended to be permanent. Also includes  flooring  that is frequently moved and reused to create a department theme or seasonal display.
1245
57.0 Distributive Trades and Services --

5 Years

Floors 
Includes concrete slabs and other  floor  systems.  Floors  include special treatments applied to or otherwise a permanent part of the  floor . For example "super flat" finish, sloped drainage basins, raised perimeter, serving line curb, or cooler, freezer and garbage room  floors .
1250
Building or Building Component –

39 Years

Take your pick, 5 or 7, but 39? And, not R & M.

Gosix (talk|edits) said:

22 August 2006
Life of a Pergo-like floor? 12x12 office/room, 144 sq. ft., $3.50 per sq ft cost installed. You're talking right at $500. I'd expense that immediately as its not worth the cost and time to track it for 5 years or 7 years or 39 years.

Maybe a better question to discuss is the merits of depreciating a home office vs. the recapture upon sale of the house eventually.

LJACPA (talk|edits) said:

22 August 2006
As I said to begin with. That's why I opt for as long a depreciation period as I can justify (or don't take HO deduction at all). You have a choice of taking deductions for a home office, but not whether to take depreciation or not. Once you start taking depreciation of any kind on a home office you'll have to track it until the 'end of time' (or until the house sells) regardless, so take as little depreciation as justifiable.

DZCPA (talk|edits) said:

23 August 2006
Gosix, Im with you. Just write the floor replacement "repair" off.

Riley2 (talk|edits) said:

24 August 2006
In Hospital Corporation of America, the Tax Court ruled that vinyl floor coverings that could be removed without damaging either the vinyl or the sub-floor should be treated as 1245 property (I believe that the Service non-acquiesced on that issue). However, my understanding of the original post was that the floor itself was replaced – not just the floor covering. There is no way to argue that the floor itself is not a structural component or part of the real estate.

Fumio (talk|edits) said:

24 August 2006
Definitly 1245, Pergo, laid over original flooring, 5 years.

Riley2 (talk|edits) said:

25 August 2006
If the substructure was replaced, then I would go for 39 years. If only the floor covering was replaced, I would go for 5 or 7 years depending on the nature of the business.

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