What roof depreciation life does the IRS require?
Short answer. The IRS treats a roof as part of the building, so it uses the building's recovery period: 27.5 years for residential rental property and 39 years for nonresidential real property, both straight-line with the mid-month convention. A roof on your personal residence is not depreciable, though its cost adds to your home's basis.
Where the IRS explains it
- Publication 527, Residential Rental Property: rental depreciation and repairs versus improvements.
- Publication 946, How to Depreciate Property: recovery periods, conventions, and percentage tables.
- Form 4562: where you report depreciation for the year an asset is placed in service.
Records the IRS expects you to keep
- The invoice and proof of payment
- The placed-in-service date
- How you treated the old roof, including any partial disposition election
- Insurance claim documents if a claim paid for the roof
If you forgot to depreciate a roof
Depreciation that was allowable reduces your basis whether or not you claimed it, which can raise taxable gain when you sell. If you missed it for two or more years, the usual fix is a change in accounting method on Form 3115 rather than amended returns, so have a preparer handle it.
Home office and mixed use
If part of your home is a qualifying home office, the business percentage of a new roof can be depreciated over 39 years as nonresidential real property.
General information only. Insurance depreciation on a claim is a different concept; see ACV vs RCV.