Determine cost basis of a rental property live in 8 years

jchan · ‎January 30, 2019

I purchase a house 380K in 2010 and last year May 2018 moved to a new house and rental old house in July.

I had the house appraised in August (600k). how do I determine cost basis for this house ?

Based on 380K ? Land or building

Based on 600K ? Land or building

PaulaM · ‎February 5, 2019

Your cost for the converted rental is going to be your adjusted basis on the building at the time of the conversion. Adjusted basis will be roughly cost + improvements - land. This will be the amount that you depreciate for the rental.

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OldTaxDude · ‎February 5, 2019

True only because the FMV exceeded basis at the time it was converted to rental. If the FMV were lower, that would be the basis for depreciation.

Determine cost basis of a rental property live in 8 years

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