Bonus depreciation for an Air BNB?

[Krisann Mayfield]

On the most recent tax episode with Amanda and Brandon, they talked about 100% bonus depreciation which you can use with an Air BNB business. My question: my husband and I will be building a garage with an apartment on the second floor to rent out specifically for Air bnb, can we write a percentage of this construction project off due to that tax benefit? If not, what costs would be excluded? If so, what all could we include to write off? Any help would be appreciated!

[Basit Siddiqi]

From my understanding that would not be eligible for section 179 expense or bonus depreciation.

You may be able to look to see if you can do a cost seg analysis and see if you can depreciate certain assets over a shorter period but its simply the skeletons/drywall - it would not qualify.

Another item to check to see if you have any qualified leasehold improvement. This is eligible for bonus + shorter depreciation life.

One thing of a benefit for an airbnb business is that you normally have to furnish it for people who will live in your space. That is normally eligible for an accelerated write-off.