The depreciation will be based on your cost. I would assume you would have records of how much in USD you spent to purchase the real estate if you were converting US dollars to PHP as you made the payments.
If not, for example you had foreign currency with which you paid, you would need to convert each payment in order to know what the value was when you no longer had control of those funds.
For your US return, you would report what it cost you in US Dollars to purchase the condo and start the depreciation on that figure.
Additionally, according to the IRS:
"Settlement fees and other costs.
The following settlement fees and closing costs for buying the property are part of your basis in the property.
- Abstract fees.
- Charges for installing utility services.
- Legal fees.
- Recording fees.
- Surveys.
- Transfer taxes.
- Title insurance.
- Any amounts the seller owes that you agree to pay, such as back taxes or interest, recording or mortgage fees, charges for improvements or repairs, and sales commissions.
The following are settlement fees and closing costs you can’t include in your basis in the property.
- Fire insurance premiums.
- Rent or other charges relating to occupancy of the property before closing.
- Charges connected with getting or refinancing a loan, such as:
- Points (discount points, loan origination fees),
- Loan assumption fees,
- Cost of a credit report, and
- Fees for an appraisal required by a lender.
Also, don’t include amounts placed in escrow for the future payment of items such as taxes and insurance."
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