One of my favorite deductions to see for short-term rental owners is land improvements.

Land improvements can make an STR significantly more marketable. Think about how important well-designed outdoor spaces are when guests are scrolling through listings on Airbnb, VRBO, and similar platforms. Most travelers aren't just booking a place to sleep; they're booking an experience. Features like pools, landscaping, driveway upgrades, patios, fire pits, and outdoor lighting can play a huge role in creating that appeal.

Now, the marketing benefit is great… but as a CPA, that’s not why land improvements are one of my favorite deductions.

Land improvements are especially powerful because they may qualify for 100% bonus depreciation if acquired and placed in service after January 19, 2025. That means instead of depreciating these costs over 15 years (the normal recovery period for land improvements), you may be able to deduct the entire cost upfront.

With 2026 underway, it's a great time to look for ways to enhance the curb appeal and guest experience of your STR. These upgrades can absolutely boost views and bookings, and they can also create a sizable tax deduction.

If you have any examples to share, feel free to leave a comment so our community can draw inspiration from your experiences! I wonder if anyone can provide a good example of incorporating a partial asset disposition as well? For those curious, if you’re replacing or tearing out an old improvement (say an outdated patio, driveway, fencing, or landscaping) you may be able to write off the remaining undepreciated value of the old asset when the new one is placed in service.

Chris Tile, CPA