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Updated almost 3 years ago on . Most recent reply presented by

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Bill Schrimpf
  • Real Estate Agent
  • Reno, NV
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Mobie Home - Accellerated Depreciation

Bill Schrimpf
  • Real Estate Agent
  • Reno, NV
Posted

Will a mobile home, newly purchased from the factory put to use as a rental, that is not immediately converted to real property, qualify for the 2017 accelerated deprecation, since it's personal property ?  If the answer is "yes" then after taking the accelerated depreciation, could it then be converted to real property and take the standard deprecation at 27.5 years?  Would this be a tenable application of tax law?  I've asked this question of 2 CPA's.  One yes, and one no.  There appears to be some differences between how lenders treat mobile homes versus the IRS.

From a lending and Realtor perspective, I'm familiar with the personal/real property designation (and how to convert the mobile to real property), but not from the IRS tax perspective.  

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ERA Realty Central - Bill Schrimpf
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Yonah Weiss
  • Cost Segregation Expert and Investor
  • Lakewood, NJ
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Yonah Weiss
  • Cost Segregation Expert and Investor
  • Lakewood, NJ
Replied

@Bill Schrimpf If the mobile home is treated as 'personal property' from a depreciation perspective, and it gets fully depreciated as 5 year property (or in the first year with 100% bonus depreciation), you cannot depreciate it again. Even if you convert it to real property, the reality is that it's been fully depreciated already.

  • Yonah Weiss
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