Security Camera System tax deductible on SFH Rental?

5 Replies

Hello BP Tax Experts!

My wife and I are in the process of getting our house ready to be used as a rental.  All inspections are done and we have our rental business license for the house.  We will be relocating to our new primary in about 2 months.

We are installing a security camera system for the property.  Is this tax deductible?  We will be here for about a month or two before the renters move in.  Any insight regarding taxes is greatly appreciated.  Thank you!

Yes, that is tax deductible. Depending on the cost it may need to be capitalized and depreciated.

For the most part, if it is reasonable for the rental it is deductible (technically the rule is ordinary and necessary, but for practical purposes it is that the expense is reasonable).

Yes it is, it would likely be an expense under the de minimus safe harbor election.

From a business standpoint I would question why you feel you need a system for a rental though.  Are you going to give the tenants access or are you just planning to record in case you want to look at something?

@Brian Schmelzlen Thanks for confirming! appreciate it. @John Woodrich Thanks. Yes and yes. I plan to give the tenants access to the system as a rental property amenity. Helps with landlording also. I've noticed home security cameras are attracting higher quality tenants or at least garnering a higher rental rate in my area.

@John T. from @brandon hall, his BARRRR strategy suggests that you should advertise the rental before purchasing so that the property is considered ready and available for rent, ie in service, to take deductions rather than having to cap and depreciate then.

@Sung Park Thanks for the tip. We actually approached one of our existing tenants and he is going to move and rent this property. Would that still count as advertising?

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