How are tax deductions treated on a live-in rental flip?

1 Reply

Hello all, I'm a newer Bigger Pockets member and I have a question about a property I am looking to buy. First off, sorry for the confusing Subject, I didn't how else to word it in 1 sentence.

My plan is to purchase a single-family house, move into it, and renovate it over the next year or two. I then plan to move and rent out the newly renovated single family. I know that if I were to buy this property as an investment property and fix and rent it, without ever living in it, I could depreciate the improvements. What I am unsure of and haven't been able to find an adequate answer is: Can I depreciate any improvements if those improvements are done while I am living in it as a primary residence? Of course my intention is to fix it up to increase the rents, not to make it prettier for my own enjoyment, but does the IRS differentiate the two?

I will be speaking with a few CPAs about this, but to be honest, I haven't found one that is well versed in this kind of stuff. And I know someone on Bigger Pockets has the answer! Thanks in advance!

Hi Anthony,

I am not a CPA so I can't answer that for sure. I would recommend talking to a few CPA's but be sure they really understand real estate investing. I would also recommend reaching out to @Amanda Han who is a very good CPA and knows all about investing. She was a guest on one of the earlier podcasts. 



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