How is a roof depreciated?
Short answer. A roof is depreciated in two different ways depending on who is asking. An insurer depreciates it by age and condition against an expected life to set the claim's actual cash value, while the IRS depreciates a roof on a rental property over 27.5 years as part of the building, and a roof on your own home is not depreciated for taxes at all.
For an insurance claim
The adjuster needs the roof's age, and it is often the most disputed number on the claim. Common sources include:
- Building permit records from your city or county
- Your purchase records, home inspection report, or seller disclosure
- Your own answer when the adjuster asks how old the roof is
- Visual cues such as shingle style, granule loss, and past repairs
That age is compared with an expected life for the material, and the share used up is subtracted from the replacement cost. Condition can push the figure up or down. On replacement cost policies the amount is held back and paid when the roof is replaced.
For taxes
- Your primary home: no depreciation. A new roof adds to your home's cost basis, which can reduce taxable gain when you sell.
- Residential rental property: the roof is part of the building and is depreciated straight-line over 27.5 years.
- Nonresidential property or a home office portion: generally 39 years.
A tip before the adjuster visits
Find your roof's install date ahead of time. Do not guess; an answer that adds years to the roof can cost you money on the claim. If you bought the house with the roof already on it, a permit search with your local building department often shows the date.
Related: roof age and insurance, ACV vs RCV, and preparing for the adjuster inspection.