Rental Depreciation, why is there variance?

I reviewed my tax returns and noticed the depreciation changed every year

Depreciation = Home Building value (not land) / 27.5 years. This must be constant. However, if they account current property value reported by county (for property tax purposes), this can vary every year.

I do not know why such small changes in every year. I will be asking the same to my CPA.

However, do you see similar changes in your tax filings or is it constant? Or how do you evaluate depreciation every year for rental property?

For me, the value of structure for depreciation purposes was determined in the year property became a rental property. That value stayed constant for each year it was a rental.

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Thank you for confirmation.

I have got the details from my CPA. Whatever I see includes depreciation of home and other improvements. Home is Straight line 27.5 methods while other improvements such as Refrigerator, Washer, Dryer…etc goes through different depreciation methods. What I see is overall Depreciation, not individual depreciation.

I don’t think that’s the right answer. You can’t take into account depreciation of appliances in your tax return.

There is a small difference because in your property tax, the structural value of the house changes every year. This accounts for the yearly differences because depreciation is based on the structural value of the house.

It seems a bit odd to me. Appliances are not a big cost. So that should be counted as expense single time when purchased. Instead of trying to take depreciation over time.

It depends if you count them as a maintenance or an upgrade. Maintenance is fully deductible the year you spend the money. Upgrades depreciate over time.

A couple of questions on the depreciation of ‘other home improvements’ like appliances, remodel etc

  1. Will depreciation recapture apply to these ‘other home improvements’ or only to the house structure cost basis depreciation?
  2. What depreciation method other than MARS is preferred?

Here is the best reference