Commercial property and depreciation

2 Replies

Can anyone provide some insight on commercial property and depreciation? It is my understanding that commercial property (i.e. A warehouse) is depreciated over 39 years.

This longer life would negate some of the tax benefits that are afforded to owners of residential rental properties (due to the shorter depreciable life on those types of properties), and would most likely cause your rental income to be taxable more often then not, right?

Any help/thoughts would be appreciated.

I know this thread is old.. hope he finds you well.

Correct. The longer the length of years to depreciate, the less you can deduct from your taxable income (NOI)...for commercial ( 39 years). a shorter length would be favorable; it increases the amount you can deduct from the NOI which essentially means less taxes taken out.

On the other hand, commercial properties have more opportunities to accelerate depreciation than residential properties.

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