Until 12/31/11 you can use Section 179 to write off 100 percent of qualified real property (called real estate for people who don’t speak IRS). Historically, only tangible personal property (equipment) qualifies for Section 179 treatment.
But for tax years beginning in 2009 and 2010, up to $250,000 of qualified real property can be treated as Section 179 property. Qualified property includes qualified leasehold improvements, qualified restaurant property, and qualified retail improvement property.
So if you are in one of those areas and are thinking about spending money on your rentals, your restaurant, or your retail property in the near future, you should 1) talk to your tax person to learn what qualifies and 2) complete it before year-end. Otherwise these expenses will be deducted using straight-line over 39 years.
Like any good CPA, I need to add a disclaimer: Unfortunately, it is impossible to offer comprehensive tax info over the Internet, no matter how well researched or written. And remember, I love my readers but having me bookmarked on your computer doesn’t make you a client: before relying on any information given on this site, contact a tax professional to discuss your particular situation.