Depreciation lets a landlord deduct the cost of a rental building gradually over years, reflecting wear over its useful life. It applies to the structure and certain improvements — not the land, which isn’t depreciated — and it’s a “non-cash” deduction: it lowers taxable income without a cash outlay that year.
Because it reduces your cost basis, depreciation can be “recaptured” and taxed when you sell, so it affects both your annual taxes and your eventual sale. The rules are technical and vary by situation — this is general education, not tax advice; have the treatment reviewed by a tax professional.
This is general educational information, not legal or tax advice. Rules vary by state and locality and change over time — check your local law and confirm specifics with a qualified professional.