Putting on a new roof
Hi Guys,
So, I'll be closing on my first rental property in about 3 weeks and I just found out this past weekend that the property needs a new roof. I mean, I knew the roof was old, but I thought I'd be able to get away with not replacing it for at least 12 months. Then, this past weekend we actually discovered a small hole in the roof through which water was slowly dripping. So, the roof will need to be replaced immediately. I'm pissed at my inspector not finding this, but that's besides the point. Right now, I'm trying to explore my options for replacing it if I can't back out of the sale (without losing my deposit anyway).
So, my question is, how do the federal taxes work when doing a major repair like this? Can I deduct the whole amount or I do I have to depreciate it? If I have to depreciate, how do I determine my basis? I tried putting this into my tax cut program, but it still wasn't clear.
I know I'll have to talk to a CPA for my specific tax situation, but I'm talking in general.
Thanks,
MyPetSlug