What happens if I don't depreciate my rental property?
Moreover, do I have to depreciate my rental property?
Yes, you must claim depreciation. But you are required to "recapture" depreciation allowed or allowable when you sell the property, in the future. That is, you will pay tax on the depreciation, when you sell, whether or not you actually claim it while you were renting it out.
Additionally, how long can you depreciate a rental property? 27.5 years
Secondly, how do you avoid depreciation recapture on rental property?
You can NOT avoid depreciation recapture taxes by making the property your principal residence. You will still owe the taxes when you sell the property. Depreciation is recaptured at the time of sale, whether you took the depreciation or not.
Can you stop depreciating rental property?
In general, you depreciate the value of the home itself (but not the portion of the cost attributable to land) over 27.5 years. You'll have to stop depreciating once you recover your cost or you stop renting out the home, whichever comes first. Depreciation is a valuable tax benefit, but the calculations can be tricky.