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Water heater for a rental

$1,000-$3,000

Can You Write Off Water Heater for a Rental?

Short answer: Replacing a water heater is usually an improvement depreciated over 27.5 years, unless you use the de minimis or small-taxpayer safe harbor.

Improvements that better, restore, or adapt the property are depreciated (27.5 years for residential buildings), though items under $2,500 can be expensed with the de minimis safe harbor.

Records to keep: Keep leases, receipts, a log of repairs vs improvements, mileage to the property, and closing statements.