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05-18-2022, 02:07 PM #1Registered User
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CPA questions about required roof replacement for insurance coverage
I recently had to replace a roof on a rental property to maintain insurance coverage. Normally roofs replacements have to be depreciated over time rather than write off as necessary repair expense BUT does the scenario change if it's required to maintain insurance coverage ?
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05-18-2022, 02:20 PM #2
CPA questions about required roof replacement for insurance coverage
I’m not aware of such an exception and it goes against the foundations and principles of depreciation. A quick glance and I see nothing about expensing repairs in full if it is required to maintain insurance.
https://www.irs.gov/publications/p52...link1000280325
For something this specific you should get the advice of a tax accountant who specializes in rental units.
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05-18-2022, 02:33 PM #3
Under IRC 179 taxpayers can expense something over ~$1million in capital expenditures used in the production of income in year of acquisition.
Don’t know if that applies to Residential real estate.
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05-18-2022, 02:41 PM #4
It does. For 2022 you can expense $1,080,000 of cap X.
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