Discussion:Depreciating rental componenets less than 27.5 years?
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Revision as of 02:17, 22 February 2008 Taxstudent (Talk | contribs) (Hospital Corp is) Next diff → |
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| {{ForumReplyPost|UserID=Djkent01|Date=21 February 2008|Text=I don't remember the details, but there is an IRS publication that deal specifically with component depreciation for casinos. It gives useful life, etc for essentially everything. If I find it I'll post a link.}} | {{ForumReplyPost|UserID=Djkent01|Date=21 February 2008|Text=I don't remember the details, but there is an IRS publication that deal specifically with component depreciation for casinos. It gives useful life, etc for essentially everything. If I find it I'll post a link.}} | ||
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| + | {{ForumReplyPost|UserID=Taxstudent|Date=22 February 2008|Text=Hospital Corp is not the basis for all cost segregation studies. Walgreens provides another basis, though more limited in scope. Residential rentals, though it is rarely remarked upon, cannot rely on Hospital Corp. Unlike nonresidential real property, the definition of residential rental property is not directly linked to the definition of section 1250 property. Instead it is linked to the more nebulous concept of a building. Presumably, that "building" is the same as the term of art "building" under the ITC, which raises the possibility of the Service disallowing short-life treatment certain kinds of section 1245 property found on residential rental property, particularly in the 4th and 7th circuits. This is an even better moneymaker: you get slow depreciation and they get full recapture. Of course, I've never seen them actually attempt this, but who can tell what tomorrow will bring?}} | ||
Revision as of 02:17, 22 February 2008
Discussion Forum Index --> Basic Tax Questions --> Depreciating rental componenets less than 27.5 years?
Discussion Forum Index --> Tax Questions --> Depreciating rental componenets less than 27.5 years?
Scottycoyote (talk|edits) said: | 21 February 2008 |
| i remember a ncpe seminar not that long ago where depreciation breakdowns were done. For example, a building was purchased and all the electrical in the building was depr'd for like 7 years, the fixtures for 10, etc etc. I was wondering if this method has spilled over for replacements as well, i have a client who put a new electrical service in a rental house at a cost of several thousand.....normally i would depr it over the life of the rental (27.5), because i view it as an integral component of the real property. Anybody doing it substantially different? Cases or code to back it up would be nice too. | |
Death&Taxes (talk|edits) said: | 21 February 2008 |
| I think Wayne and Jerry were referring to Hospital Corp of America, a case which is the basis for all cost segregation studies. Do a search here for Roof replacement and you might find another case like Thomas J. Northen, Jr. et ux vs Comm, TC Summary Opinion 2003-113. | |
RoyDaleOne (talk|edits) said: | 21 February 2008 |
| I look at an IRS "publication" and it suggested that taxpayers must follow the HCA case. I could see how the IRS see this as money maker on the sale of the property. HCA covers the non-structural components of a building. | |
| 21 February 2008 | |
| I don't remember the details, but there is an IRS publication that deal specifically with component depreciation for casinos. It gives useful life, etc for essentially everything. If I find it I'll post a link. | |
Taxstudent (talk|edits) said: | 22 February 2008 |
| Hospital Corp is not the basis for all cost segregation studies. Walgreens provides another basis, though more limited in scope. Residential rentals, though it is rarely remarked upon, cannot rely on Hospital Corp. Unlike nonresidential real property, the definition of residential rental property is not directly linked to the definition of section 1250 property. Instead it is linked to the more nebulous concept of a building. Presumably, that "building" is the same as the term of art "building" under the ITC, which raises the possibility of the Service disallowing short-life treatment certain kinds of section 1245 property found on residential rental property, particularly in the 4th and 7th circuits. This is an even better moneymaker: you get slow depreciation and they get full recapture. Of course, I've never seen them actually attempt this, but who can tell what tomorrow will bring? | |
