Pool resurfacing at rental

[Dave Peterson]

Is resurfacing a pool at a rental property considered a repair or a capital expense for tax purposes?  If the latter, what is the depreciation period?  Thanks.

[Ashish Acharya]

Originally posted by @Dave Peterson:

Is resurfacing a pool at a rental property considered a repair or a capital expense for tax purposes?  If the latter, what is the depreciation period?  Thanks.

Dave,

Indoor pool are considered building. However, outdoor pools are considered land improvements. This distinction is important because the land improvement is 15 your property and even the capital improvement to the land improvement will qualify for 100% bonus deduction. So repair or capital improvement, the outdoor pool will get the same deduction. 

I would suggest capitalizing It to get the asset basis for QBI deduction if you were limited.

If it’s indoor pool, then you would benefit from a repair. However, the complete resurfacing will not be a repair. You have to capitalize the cost and depreciate it over 27.5 or 39 years.