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Depreciation of a rental house
Posted on 2/8/13 at 1:47 pm
Posted on 2/8/13 at 1:47 pm
I bought a rental house in November of last year. I'm doing my taxes right now, and Turbotax is giving me a $600 depreciation on it (purchase price was $195). Does this sound right? Are they giving me depreciation of a pro-rated amount since I purchased so late in the year?
4
Posted on 2/8/13 at 2:01 pm to BullredsRus
200k on a rental house? damn brah...what kind of rent are you getting?
Sorry I am no help on your question.
Sorry I am no help on your question.
Posted on 2/8/13 at 2:09 pm to BullredsRus
Well, it does depend on when you start it. If you bought it in Dec, that might be right.
Posted on 2/8/13 at 2:27 pm to BullredsRus
Residential rental properties get depreciated straight line over a 27-1/2 year period, and they are subject to the mid-month convention, which means they are treated as placed in service on the 15th daqy of the month. So you would get 1-1/2 months worth of depreciation for 2012. That means you get 1.5/330 = 0.454545% of the basis in the building for depreciation (some of the purchase price should be allocated to the land which is not depreciable).
Let's assume you allocate $40,000 of purchase price to land. You have $155,000 of depreciable basis in the building. $155,000 x 0.454545 = $705 of depreciation.
Let's assume you allocate $40,000 of purchase price to land. You have $155,000 of depreciable basis in the building. $155,000 x 0.454545 = $705 of depreciation.
Posted on 2/8/13 at 3:16 pm to BullredsRus
I owned a rental house for twenty years and one of the hardest things about it was keeping up with all the depreciation accounts. All major repairs and improvements had their own depreciation schedule and there was no TurboTax to help back then. It's why accountants stay in business.
Posted on 2/8/13 at 3:38 pm to Layabout
Trying to figure this out right now. Started renting out my house in Central Texas last February.
Posted on 2/8/13 at 3:44 pm to I Love Bama
It's actually a duplex. I get 1200 per unit.
Thanks Poodlebrain, that pretty much answers my question. I've always used turbotax with no issues, but I'm thinking of calling a CPA this year bc there are things that just don't look right and there is no one to answer my questions with turbotax
Thanks Poodlebrain, that pretty much answers my question. I've always used turbotax with no issues, but I'm thinking of calling a CPA this year bc there are things that just don't look right and there is no one to answer my questions with turbotax
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