How Does Depreciation Work for Rental Properties?

Rental property depreciation allows investors to reduce taxable income by spreading the cost of a property over 27.5 years. This article explains how depreciation works, how it offsets rental income, and how improvements are treated. It also covers what happens when a property is fully depreciated and how depreciation recapture impacts taxes when selling. Understanding these rules can help investors maximize tax efficiency and avoid costly surprises.