Accelerated/Declining Depreciation?
It is my understanding that if I buy a rental property for $100K, and the land value is $20K, then I depreciate the $80K equally over the next 27.5 years.
A fellow investor keeps telling me that you can use accelerated depreciation on a rental property, or declining, but I am just not seeing this anywhere.
This also goes to the myth or fact that most investors hold a property for about 10 years and then get out of it due to most of the depreciation being gone. If it was declining depreciation over 27.5 years I could see that, but I thought it was equally depreciated over the 27.5.
Thanks.
Buildings used for residential rental are depreciated over 27.5 years straight line (adjusted for a partial year in the year of purchase and the year of sale). The only exception may be to property in the NY "Liberty Zone". Personal property (carpet & appliances) can be depreciated using accelerated depreciation. You may want to look at IRS publications 527 & 946.
Thanks Blueford ...