Posted by Dave T on April 21, 2000 at 13:00:45:
I am not a tax or accounting expert but I believe the reason you might want separate depreciation schedules for hotel/motel furnishings is because a hotel or motel is a commercial property – not an investment rental property. As a commercial property there is a 39 year depreciation period. You want the faster depreciation allowed for the furnishings (and thus a larger depreciation allowance) to offset income.
The accountants on this board may also have specific accounting reasons for doing this, perhaps related to reserve accounts for replacement of business furniture.
In your situation, I always assume that the major appliances and carpet are already fully depreciated (or nearly so) when I purchase an investment rental property. Therefore, I don’t establish a searate depreciation schedule for replacement capital items until I actually install them in the property.
The tax experts on this board will have to tell us whether separatly depreciating the major appliances, systems, and property is even permitted for a newly acquired investment rental.
