HVAC depreciation period in a rental?

tadamsmar · Joined: 21 Feb 2008 Posts: 1

It seems to 27.5 years, but can that be right? I don't think it will
last that long.

Archived from group: misc>taxes

phil scott · Joined: 07 Nov 2007 Posts: 50

On Feb 21, 12:28 pm, "tadams...@yahoo.com"
wrote:
> It seems to 27.5 years, but can that be right? I don't think it will
> last that long.

Im in that business. After 10 years most are just about toast.... a
few exceptions. but not many and not much longer.,,, high effiicency
seer 14 or so... maybe 12 years.... most are seer 9 or 10... 8 to 9
years max. seer =seasonal efficiency rating.

by the ocean with salt air.. 5 years... or way less

heavy use 5 to 7 years

Phil scott

Arthur Kamlet · Joined: 25 Aug 2007 Posts: 2053

In article ,
phil scott wrote:
>On Feb 21, 12:28 pm, "tadams...@yahoo.com"
>wrote:
>> It seems to 27.5 years, but can that be right? I don't think it will
>> last that long.
>
>Im in that business. After 10 years most are just about toast.... a
>few exceptions. but not many and not much longer.,,, high effiicency
>seer 14 or so... maybe 12 years.... most are seer 9 or 10... 8 to 9
>years max. seer =seasonal efficiency rating.
>
>
>by the ocean with salt air.. 5 years... or way less
>heavy use 5 to 7 years

The length of time that assets will live is irrelevant for purposes of
calculating depreciation.

One example I use when teaching this is to consider a self-employed
taxpayer who has a three bedroom house. Three identical bedrooms.

One is is personal bedroom. One is his Office in the Home, used for
his self employment work.

And the third bedroom is rented out to someone to live in under
a two-year lease.

Bedroom #1 is not depreciable property.

Bedroom #2 is depreciable ith a 39 year class life.

Bedroom 3 is depreciable with a 27.5 yr class life.

And these are all identical bedrooms.

--

ArtKamlet at a o l dot c o m Columbus OH K2PZH

phil scott · Joined: 07 Nov 2007 Posts: 50

On Feb 21, 9:53 pm, kam...@panix.com (Arthur Kamlet) wrote:
> In article ,
> phil scott wrote:
>
> >On Feb 21, 12:28 pm, "tadams...@yahoo.com"
> >wrote:
> >> It seems to 27.5 years, but can that be right? I don't think it will
> >> last that long.
>
> >Im in that business. After 10 years most are just about toast.... a
> >few exceptions. but not many and not much longer.,,, high effiicency
> >seer 14 or so... maybe 12 years.... most are seer 9 or 10... 8 to 9
> >years max. seer =seasonal efficiency rating.
>
> >by the ocean with salt air.. 5 years... or way less
> >heavy use 5 to 7 years
>
> The length of time that assets will live is irrelevant for purposes of
> calculating depreciation.
>
> One example I use when teaching this is to consider a self-employed
> taxpayer who has a three bedroom house. Three identical bedrooms.
>
> One is is personal bedroom. One is his Office in the Home, used for
> his self employment work.
>
> And the third bedroom is rented out to someone to live in under
> a two-year lease.
>
> Bedroom #1 is not depreciable property.
>
> Bedroom #2 is depreciable ith a 39 year class life.
>
> Bedroom 3 is depreciable with a 27.5 yr class life.
>
> And these are all identical bedrooms.
>
> --
>
> ArtKamlet at a o l dot c o m Columbus OH K2PZH

yes yes...and none of those are *equipment. there are depeciation
schedules for most of that.
equipment.... mush shorter than sidewalks or structures,,,, but longer
than for toilet paper

cbritt · Joined: 22 Feb 2008 Posts: 4

HVAC - all components of central heating, ventilating, AC system is
section 1250 property and so are depreciable at 27.5 years
(residential rental) or 39 years (Treasury Regulation 1.48-1)

There is a FREE to use online application DepreciateEm.com
(www.DepreciateEm.com) that in 3 easy steps maximizes depreciation
deduction. You can also find a list of assets and their depreciation
lives in a pdf on step 2 of the application. This downloadable
document is great checklist.

C.

On Feb 21, 10:27 pm, phil scott wrote:
> On Feb 21, 9:53 pm, kam...@panix.com (Arthur Kamlet) wrote:
>
>
>
>
>
> > In article ,
> > phil scott wrote:
>
> > >On Feb 21, 12:28 pm, "tadams...@yahoo.com"
> > >wrote:
> > >> It seems to 27.5 years, but can that be right? I don't think it will
> > >> last that long.
>
> > >Im in that business. After 10 years most are just about toast..... a
> > >few exceptions. but not many and not much longer.,,, high effiicency
> > >seer 14 or so... maybe 12 years.... most are seer 9 or 10... 8 to 9
> > >years max. seer =seasonal efficiency rating.
>
> > >by the ocean with salt air.. 5 years... or way less
> > >heavy use 5 to 7 years
>
> > The length of time that assets will live is irrelevant for purposes of
> > calculatingdepreciation.
>
> > One example I use when teaching this is to consider a self-employed
> > taxpayer who has a three bedroom house. Three identical bedrooms.
>
> > One is is personal bedroom. One is his Office in the Home, used for
> > his self employment work.
>
> > And the third bedroom is rented out to someone to live in under
> > a two-year lease.
>
> > Bedroom #1 is not depreciable property.
>
> > Bedroom #2 is depreciable ith a 39 year class life.
>
> > Bedroom 3 is depreciable with a 27.5 yr class life.
>
> > And these are all identical bedrooms.
>
> > --
>
> > ArtKamlet at a o l dot c o m Columbus OH K2PZH
>
> yes yes...and none of those are *equipment. there are depeciation
> schedules for most of that.
> equipment.... mush shorter than sidewalks or structures,,,, but longer
> than for toilet paper- Hide quoted text -
>
> - Show quoted text -

Paul Thomas, CPA · Joined: 25 Aug 2007 Posts: 3094

"phil scott" wrote
> I spent a lot of time in corporate america... these
> practiced the use of budget categories and were
> more than slightly dillignent in seeing it that as
> many major projects got 'put into the maintenance
> budget' as possible.... thats the comon practice.

Possibly for financial purposes. Possibly for property tax purposes.

But you don't buy a new copier and call it "fixing the broken copier" repair
for tax purposes.

> similarly seen with realestate, an old home is torn down
> to the foundations

The costs to raze the old building are folded into the land cost.

> and 'remodeled' from the foundation up,

Boy. You must think the IRS is dumb.

> so now say you decide to fix yer ac
> unit..... do you suppose the IRS
> is going to be audiiting all that?

They often do. "Let me see the receipts for all expenses in the repair and
maintenance" category.

They regularly and routinely audit to the details on those accounts if there
is any significant dollars there.

--
Paul A. Thomas, CPA
Athens, Georgia

P. Maffia · Joined: 10 Nov 2007 Posts: 117

"Paul Thomas, CPA" wrote in message $rc2.18128@bignews1.bellsouth.net...
>
> "phil scott" wrote
>> I spent a lot of time in corporate america... these
>> practiced the use of budget categories and were
>> more than slightly dillignent in seeing it that as
>> many major projects got 'put into the maintenance
>> budget' as possible.... thats the comon practice.
> Possibly for financial purposes. Possibly for property tax purposes.
>
> But you don't buy a new copier and call it "fixing the broken copier"
> repair for tax purposes.
>
>> similarly seen with realestate, an old home is torn down
>> to the foundations

> The costs to raze the old building are folded into the land cost.
>
>> and 'remodeled' from the foundation up,
>
> Boy. You must think the IRS is dumb.

Well, he thinks he is smarter than the average bear. A few days ago he
admitted he didn't know real estate, when I again corrected his moronic
rants about San Francisco real estate, and it is obvious he knows even less
about accounting and taxes, but i does stop him from making his moronic
observations about any of these subjects he knows nothing about.

>> so now say you decide to fix yer ac
>> unit..... do you suppose the IRS
>> is going to be audiiting all that?
>
> They often do. "Let me see the receipts for all expenses in the repair
> and maintenance" category.
>
> They regularly and routinely audit to the details on those accounts if
> there is any significant dollars there.

Don't confuse Phil with facts.

cbritt · Joined: 22 Feb 2008 Posts: 4

Repairs are for fixing a problem while improvements are replacement of
an asset. For example replacement of roof, windows, etc are all
improvements. I agree that in some cases the situation may not be that
clear but in most cases it is very clear. For example if you paint
your property it is a repair but if you replace your furnace it is an
improvement.

Here are some sites with discussion around this

http://www.realtaxtips.com/story.php?title=Improvements_VS-_Repairs
http://www.irs.gov/faqs/faq-kw13.html

C

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