QIP and STRs

[Sean Graham]

Short-term rental owners upgrade their properties all the time.

- New flooring.
- Interior lighting.
- Kitchen refresh.
- Bathroom remodel.

But most hosts miss this:

Those interior improvements may qualify as QIP (Qualified Improvement Property), which means 15-year property, not 39-year… and potentially bonus eligible.

If you’re depreciating interior renovations over 39 years, you may be dramatically underutilizing your deductions.

Key rules most STR owners overlook:
• Must be interior improvements (not structural, not expanding the building)
• Must be placed in service after the building was originally placed in service
• Applies to non-residential property, which many STRs can qualify as, depending on facts

Combine QIP with cost segregation, and you’re not just accelerating appliances and furniture that you’re accelerating interior buildout, too.

Cash flow isn’t just a nightly rate.

It’s tax-efficient.

If you’ve renovated a short-term rental in the last few years, it’s worth double-checking how those dollars were categorized.