$25.00 
Learn more
Submitted By: someone
Answered: May 6, 2019 9:46 pm
Answered: May 6, 2019 9:46 pm
I converted a second home to rental property. How do I determine basis for depreciation?
For depreciation purposes, the basis is the lower of your actual basis (generally cost, plus capital improvements), or the property’s fair market value on the date of its conversion to rental property. Remember that only the home can be depreciated, so an allocation for the land must be made; the land is not depreciated.
advertisement
Featured Books
Tax Glossary
Private letter ruling
A written determination issued to a taxpayer by the IRS that interprets and applies the tax laws to the taxpayer’s specific set of facts. A letter ruling advises the taxpayer regarding the tax treatment that can be expected from the IRS in the circumstances specified by the ruling. It may not be used or cited as precedent by another taxpayer.
