New York State Real Estate Salesperson Licensing Exam

For how many years is a residential investment property depreciable?

1. 15 years

2. 27.5 years

3. 39 years

4. 50 years

The correct answer is: 27.5 years

A residential investment property is depreciable over a period of 27.5 years according to the IRS guidelines. This time frame is established for residential real estate, allowing property owners to claim a tax deduction based on the gradual decrease in value of the asset over its useful life. The 27.5-year period applies specifically to residential properties, contrasting with commercial properties, which have a longer depreciation schedule of 39 years. Understanding these distinctions is crucial for investors to effectively manage their investments and financial planning, especially when it comes to tax advantages related to real estate investments.