Discussion:Rental Property / Sec 179
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Discussion Forum Index --> Tax Questions --> Rental Property / Sec 179
| 4 February 2007 | |
| My wife qualifies as a real estate professional and we acquired a rental property this year. My questions is if we can take a Sec 179 deduction for all of the appliances and furniture we bought to furnish the house. It seems reading through the regs that you can take a Sec 179 if the property was acquired for use in your trade or business which we qualify for.
Thanks. | |
| 4 February 2007 | |
| Furnishings for transient lodging (e.g. hotel or motel) will qualify for Sec. 179. Furnishings for non-transient lodging will not qualify for Sec. 179 unless the lodging is a certified historic structure. See Sec 179(d) and Sec. 50(b). | |
| 4 February 2007 | |
| Does it matter that I am considered to be in the business of renting property (real-estate professional)?
"Property Acquired for Business Use. To qualify for the section 179 deduction, your property must have been acquired for use in your trade or business. Property you acquire only for the production of income, such as investment property, rental property (if renting property is not your trade or business), and property that produces royalties, does not qualify." | |
| 4 February 2007 | |
| No, it doesn't matter. The rental activity is going on schedule E, not C. It is only going to rise to a TorB if you run it through C (and subject it to SET). i.e. Hotels, Motels, B&B, etc... ( I realize that your wife files C for her 1099 and related expenses. Her business of brokering RE deals does not effect the treatment of personal property used in your rentals.) | |
| 4 February 2007 | |
| Oc 35, Congresss specifically intended to exclude property used for non-transient lodging purposes from the scope of Sec. 179 -- regardless of whether the owner is a real estate professional. | |
| 5 February 2007 | |
| Ok....thanks. Thought I may have been onto something there. Am I correct in assuming that all furniture, fixtures, appliances, TV's, etc can not even be capitalized and depreciated (as a cap improvement). I realize that a 'normal' cap improvement (roof, window coverings, pool, etc) would be ok. | |
| 5 February 2007 | |
| Rental furniture/fixtures can be depreciated over 5 years. | |
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