What is the depreciation rate for a new roof?
Short answer. For a roof on residential rental property, the tax depreciation rate is about 3.636 percent of the cost per full year over 27.5 years, with a smaller first year under the mid-month convention. On nonresidential property it is about 2.564 percent per year over 39 years, and a roof on your own home has no tax depreciation rate.
A rental roof example
A $14,000 roof on a rental, placed in service in January:
- Year one: about 3.485 percent, roughly $488, because only 11.5 months count
- Each full year after that: about 3.636 percent, roughly $509
- The IRS publishes the exact percentage for every year and starting month in the tables in Publication 946
The insurance rate, for comparison
Insurers do not use the tax tables. On a claim, a roof's depreciation rate is roughly 1 divided by its expected life for that material, such as about 4 percent a year for a 25-year life, adjusted for condition. A roof that is half depreciated on a claim may be barely depreciated on a tax return, and the reverse.
Things that change your numbers
- The month the roof is placed in service
- Whether part of the cost belongs to a business use of your home
- The partial disposition election on the old roof
- Whether insurance paid for part of it, which can affect basis
Use these figures as orientation only and confirm them with a tax professional. For the claim side, see ACV vs RCV and roof age and insurance.