Bonus Depreciation - Schedule E vs C

[Philip Sriployrung]

Hi everyone,

I'm using a FreeTaxUSA to file my taxes. I currently own one rental SFR, purchased May of 2018. I did an online cost segregation study through KBKG.

I was able to break out my depreciation based on the 5/15/27.5 life of the property on the Schedule E form but it didn't give me the option to take the 100% bonus depreciation. The customer service reps at FreeTaxUSA are telling me bonus depreciation can only reported on Schedule C, taken after section 179 and does not apply to residential rental property.

None of what they're telling me sounds accurate. Yes, I know they're not real estate CPA's. This discussion is not on the merits of using online tax filing tools. Of course I'd love to work with a CPA who focuses on RE, but at this point it doesn't make sense financially. I'm only in the 12% tax bracket.

My questions- 

Can someone point me to what it says in the IRS tax code?

Does it matter if my rental property is listed under Business Income (schedule C) or Rental Income (schedule E)?

Thanks!

[Natalie Kolodij]

You paid for a cost segregation on a SFH but aren't willing to pay for a tax pro?

I'd be shocked if any free software handled this reporting correctly. 

Bonus doesn't apply to residential rentals- but when you cost seg you're reclassifying part of the property from 1250. This is why the person is the value not software.