Short answer
A mobile home park or an RV park is unusual among rental properties: most of what the owner bought is not a building. The value sits in the land and in the improvements to it, such as pads, internal roads, sidewalks, water and sewer runs, electrical distribution to the sites, hookups, fencing, drainage, lighting and landscaping. Land is never depreciated, and land improvements are 15-year property under the general depreciation system, so a study on a park is largely an exercise in separating non-depreciable land from 15-year improvements, with a smaller set of buildings, such as an office, a clubhouse or a bathhouse, and some personal property. Because 15-year property is qualified property for bonus depreciation, a park acquired after January 19, 2025 can expense a large share of its depreciable basis in the first year. The residential test, the treatment of park-owned homes and RV transient use, and the evidence for site work are where the questions lie. This article covers them. It is general education, not tax advice.
What a park is made of
| Component | Class | Notes |
|---|---|---|
| Land | Not depreciable | Often the largest share of the price; separated first by fair market value |
| Pads, roads, sidewalks, curbs, parking | 15-year land improvements | The core of a park study |
| Water, sewer and electrical distribution to sites; hookups | 15-year land improvements in general, with the legal analysis recorded for each system | Classification is on function and the law; document the reasoning |
| Fencing, lighting, drainage, landscaping with a determinable life | 15-year land improvements | |
| Office, clubhouse, laundry, bathhouse, maintenance buildings | 27.5- or 39-year, depending on the residential test for the park's income | Small share of basis in most parks |
| Park-owned mobile homes rented to tenants | Residential rental property includes a mobile home; generally 27.5-year | Each home is its own asset with its own dates |
| Laundry equipment, office equipment, furnishings, signage | 5- or 7-year property on their facts |
The rows are where questions usually land, not answers for a particular park. A study records the reason for each item.
The residential test in a park
Residential rental property is a rental building or structure, including a mobile home, from which 80 percent or more of the gross rental income for the year comes from dwelling units. For a park that rents lots to owners of their own homes, the buildings the park owns, such as an office or clubhouse, are tested on the park's income; the adviser decides whether the lot rents count as income from dwelling units for that purpose, which is a fact-and-law question this article does not resolve. For park-owned homes rented as residences, each home is residential rental property in its own right.
RV parks add the transient question. A dwelling unit does not include a unit in an establishment more than half of whose units are used on a transient basis. An RV park with mostly short stays is likely nonresidential for any buildings it owns, which changes those buildings' recovery period to 39 years, and its rental activity may fall under the short-term rules for passive activity purposes. The land improvements are 15-year property either way.
Evidence for site work
A park's basis is mostly site work, and site work is where records are thinnest. The evidence a practitioner needs:
- The closing statement and an appraisal or assessor record for the land split; in a park the land line is decisive.
- Site plans and utility as-built drawings, if any exist, for the runs and hookups.
- A site visit with measurements: lineal feet of road and utility runs, number and size of pads, counts of hookups, fencing and lighting.
- Utility company records and permits for the electrical and water systems.
- Invoices for any recent site work, which is its own asset with its own dates.
- Rent rolls showing lot rents, home rents and stay lengths.
Where records are unavailable, the IRS guide accepts an engineering cost estimate from measured quantities and documented unit costs, with the estimate disclosed. In a park that is the usual case.
Bonus depreciation and the park
Because so much of a park's depreciable basis is 15-year property, the bonus depreciation rules matter more here than for almost any other property type. For a park acquired after January 19, 2025, the 15-year improvements and the 5- and 7-year property are qualified property under the permanent 100 percent rule; the buildings and the park-owned homes are not. For a park acquired earlier, the phase-down applies. The acquisition date, including the binding-contract rule, and the placed-in-service date of each improvement therefore drive the first-year result, and the file has to show them.
The same limits apply as for any rental: the deduction is timing; rental losses are generally passive; and depreciation on the 15-year property is recaptured as ordinary income on sale.
Later site work
Parks are improved continuously: a repaved loop road, new pedestals, an expanded pad, a replaced water main. Each project is its own asset with its own placed-in-service date and its own bonus depreciation analysis, and each replacement of an existing improvement is a candidate for a partial disposition of the old one. A park study's asset list, with the improvements measured and priced, is what makes those later dispositions computable.
Common errors in park studies
- Treating the whole site as land, leaving the improvements undepreciated, or treating the whole price as improvements, ignoring the land split.
- Classifying utility distribution without a written function analysis.
- Counting park-owned homes as land improvements rather than as separate residential rental property.
- Ignoring the transient-use question for RV parks.
- Missing later site work, which has its own dates and its own bonus eligibility.
- Using a percentage from another park; the land share alone makes that meaningless.
What people ask on Reddit and other forums
Park investors have their own threads in "cost segregation reddit" searches on r/realestateinvesting and r/MobileHomeParks. The searches that lead people to these threads are usually phrased "cost segregation mobile home park", "RV park depreciation" and "land improvements 15 year property".
"Isn't a park just land?" The land is not depreciable, but the pads, roads, utility runs, hookups, fencing, lighting and drainage are 15-year land improvements, and they are usually most of the depreciable basis.
"Can I bonus the whole park?" The 15-year improvements and the 5- and 7-year property are qualified property; the buildings and park-owned homes are not. For property acquired after January 19, 2025 the rate is 100 percent.
"Are the homes I own in the park 27.5-year?" Residential rental property includes a mobile home rented as a residence, so generally yes, each as its own asset.
"My RV park is mostly weekend stays. Does that matter?" Yes. Transient use affects whether park buildings are residential, and short average stays affect the passive activity treatment of the rental activity. Ask your adviser.
Questions people also ask
What depreciation class are mobile home park pads and roads?
Generally 15-year land improvements under the general depreciation system, with the classification recorded item by item.
Is a mobile home park residential rental property?
Park-owned mobile homes rented as residences are residential rental property. Whether the park's own buildings are residential depends on the 80 percent test applied to the park's income, a question for your adviser.
Does bonus depreciation apply to a mobile home park?
To the 15-year land improvements and the 5- and 7-year property, at 100 percent for a park acquired after January 19, 2025. Not to buildings or park-owned homes.
Is an RV park treated differently from a mobile home park?
The land improvements are treated the same. Transient use affects the residential test for park buildings and the passive activity treatment of the rental activity.
What evidence does a park study need?
The land split, site plans or a measured site visit, utility records, invoices for recent site work and rent rolls showing stay lengths.
Sources
- https://www.irs.gov/publications/p527 — IRS Publication 527 (2025), Residential Rental Property: Chapter 2, residential rental property (including a mobile home).
- https://www.irs.gov/publications/p946 — IRS Publication 946 (2025), How To Depreciate Property: Chapters 1 and 4; Appendix B, asset class 00.3, land improvements.
- https://www.law.cornell.edu/uscode/text/26/168 — 26 U.S.C. §168(e)(2)(A)(ii).
- https://www.irs.gov/pub/irs-pdf/p5653.pdf — IRS Publication 5653, Cost Segregation Audit Techniques Guide (Rev. 2-2025): Chapters 3 and 4.
- https://www.irs.gov/publications/p551 — IRS Publication 551 (Rev. December 2024), Basis of Assets: allocating the basis.
- https://www.irs.gov/newsroom/treasury-irs-issue-guidance-on-the-additional-first-year-depreciation-deduction-amended-as-part-of-the-one-big-beautiful-bill — IR-2026-06 (January 14, 2026), bonus depreciation guidance.
- https://www.irs.gov/publications/p925 — IRS Publication 925 (2025), Passive Activity and At-Risk Rules.
Related reading
- Land and building allocation
- Construction cost support in a cost segregation study
- Cost segregation for multifamily and apartment buildings
- Short-term rentals and cost segregation
- The evidence a cost segregation study needs
- What Reddit asks about cost segregation, answered with sources
- Find a practitioner in the NBCSS directory