Bonus depreciation on primary converted to rental

[Ajul Shah]

Hi there, hope someone can help me with this question. I have had conflicting advice from cost segregation specialist versus our CPA. If a primary residence is converted to a long-term rental property, can bonus depreciation still be claimed in the first year? Our CPA says yes but the cost segregation  specialist says bonus depreciation does not apply to primary converted to rental. Does anyone have any advice?

[Michael Plaks]

Quote from @Ajul Shah:

If a primary residence is converted to a long-term rental property, can bonus depreciation still be claimed in the first year? Our CPA says yes but the cost segregation  specialist says bonus depreciation does not apply to primary converted to rental. 

Yes, you can apply bonus depreciation to a converted property, with some caveats:
- it will be based on your original purchase price, not today's value
- bonus depreciation for 2024 is 60%, not 100%
- most importantly, you may or may not benefit from cost segregation/bonus depreciation

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