Is putting a new roof on a rental property tax deductible?

Repair or improvement?

IRS rules treat work that restores, betters or adapts a building as a capital improvement. Replacing an entire roof generally restores a major component of the building, so it is capitalized. Patching a leak, replacing a handful of shingles or fixing flashing keeps the roof in its normal operating condition, so it is usually a deductible repair.

Small landlord safe harbor

Owners of smaller rental buildings may be able to elect a safe harbor that lets them deduct improvements in the year paid, as long as total repairs, maintenance and improvements on that building for the year stay under set limits, generally the lesser of $10,000 or 2 percent of the building's unadjusted basis, for buildings with an unadjusted basis of $1 million or less. A full roof replacement usually exceeds those limits, but it is worth asking your preparer.

The old roof

When you replace a roof on a rental, any undepreciated cost of the old roof may be written off through a partial disposition election instead of continuing to depreciate a roof that no longer exists. It requires accurate records, so ask your preparer before you file.

If insurance paid for it

A storm-damaged rental roof replaced through a landlord policy has its own tax treatment involving the insurance proceeds and casualty rules. Keep the insurer's estimate and payment records. Rental homes with older roofs also face higher premiums or coverage limits. See roof age and insurance and how roof replacement claims work.

This is general information, not tax advice.