? Re depreciation length on STR roof replacement

[Jared Cooper]

Hi! I recently had a new roof replacement on my short-term rental (average stay under 30 days) and I would like to know the depreciation period for the roof? Is it 27.5 years or 39 yrs? I also had a recent cost segregation study performed and they had the roof components prior to the replacement at all 39 years. 

Also, if you can you please cite the correct source document and or IRS section that supports the 27 1/2 or the 39 year depreciation length? Thank you! 

[Jason Malabute]

Janet is right that the new roof on your STR is depreciated over 39 years as non-residential real property, not 27.5 — so that part is settled. But there’s a planning opportunity nobody has mentioned yet that’s worth knowing before you file. When you replace a structural component like a roof, the IRS lets you elect to retire the old one under the partial asset disposition rules. In plain terms: if the old roof still had remaining tax basis on your depreciation schedule, you may be able to deduct that remaining value in the year of replacement rather than just losing it. If you’ve owned the property for a while and it was being depreciated — or if a prior cost segregation study assigned specific value to the roof — there may be real money sitting there. It’s easy to miss and worth asking your CPA about before you file.