Episode Details

Dr. Friday explains standard depreciation periods for residential and commercial rentals. She also covers cost segregation benefits and why recapture should be part of long-term planning.

Transcript

G’day, I’m Dr. Friday, president of Dr. Friday’s Tax and Financial Firm. To get more info, go to www.drfriday.com. This is a one-minute moment.

Rental properties continue to have depreciation rules: 27.5 years for residential and 39 years for commercial. Bonus depreciation may apply to improvements, although bonus rates decrease on schedule.

Landlords can still use cost segregation studies. That’s big, because if you’re buying something and you want to do cost segregation, you can pull out air conditioners and other equipment for faster depreciation.

But if you’re doing all that, you need to understand in the big picture you do have to do the other side, which is called recapture of depreciation.

So make sure you’re saving money today and not putting a big old hole in your pocket tomorrow.

You can catch the Dr. Friday Call-in Show live every Saturday afternoon from 2 to 3 p.m. right here on 99.7 WTN.