An investor who lives in the US has a single family home which has been fully depreciated. It is on the beach and has only been rented. It has never been used by the owner.

One of the outside walls is rotting away. A contractor is brought in and the wall is replaced. For tax purposes, is the cost of the new wall considered a repair? That is, can you deduct the cost of the new wall in the current year or does the cost of the wall have to be depreciated over several years? If it is the latter, can Section 179 bonus depreciation be taken?


Well...... Assuming you are using a cash accounting system, it is possible to depreciate the entire amount in a single year. There is something called a De Minimus Safe Harbor election you can take on your return. If the contractor is willing to give you a receipt with no single line item over $2500, you can take the whole thing as a repair.

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    Welcome to money.se @BigDaddyD This isn't incorrect but it's not complete. For example, I found this in IRS Pub 527: "For more information on electing and using the de minimis safe harbor for tangible property, see chapter 1 of Pub. 535, Business Expenses. – user662852 Sep 5 '18 at 12:20
  • You can assume the cost of the wall is over $10,000. – Bob Sep 5 '18 at 16:08
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    What is your point Bob? It comes down to the LINE ITEMS on the invoice.... not the total amount. – user76763 Sep 6 '18 at 2:18
  • My point is that I do not think he can be taken as a repair. – Bob Sep 8 '18 at 14:51
  • Of course he can. Did you not read my answer? It spells out in great detail how to take it as a repair. – user76763 Sep 8 '18 at 23:27

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