What happens after 27.5 years with major improvements, can you still deduct?

[Joe Michaels]

Hi,

Just watched the latest BP podcast about cost segs and it got me thinking....What happens after depreciation runs out on your property?  So as I understand it, repairs/maintenance is fully deductible the same year but major improvements have to be depreciated.  What happens if you have an "improvement" after year 27.5.  

Say you need a new roof, or a new boiler at year 28 of ownership......does this turn into repairs/maintenance?  What happens?!

Thanks Guys!

Joe

[Michael Plaks]

Quote from @Account Closed:

Your question implies that you expect some logic behind our tax system. Sorry to burst your bubble, Mike, ain't so.

As it stands right now, depreciation is not optional.

Now, if you never sell but instead do 1031 exchanges and ultimately leave your properties to your heirs - then you avoid the recapture.