Thanks Dianne, per IRS.Gov that requirement is, All allowed or allowable depreciation must be considered at the time of sale. for the purpose of calculating, the taxable basis and gain or loss on disposition of the asset. correct? Is their a rule that requires this to be done to reduce the profit or loss of rental property? All I see are things that say your allowed to, bur nothing says you are required to. I get it that its a smart practice, but there is nothing saying I have too. I do understand that its required to get the right basis but I do not have to claim it as an expenses, if I don/t get a benefit for it, correct? I just should keep records of when the property went in to service and plan to decrease the basis of the rental property by the amount of depreciation I COULD have claimed to get to the basis of my gain or loss on that sale.
I have been told I need to go back and file amended returns for this. There is no reason , I have losses every year, I make well over 500k , They are losses. I have no profit to reduce, I can't claim any losses, so why would I have to go through the work to create these and send them to the IRS? The IRS is not supposed to keep my records of depreciation I am. The IRS rule 308 tells me what needs to be filed in regards to an amended return and since nothing changes on my previous 1040, aka no income or tax or refund or amount owed or change in status , nothing per rule 308 happens, so there is not Legal required reason to do it this way. If there is please show me the IRS code/ reference that says this is required to be deducted as an expense off the income. As far as I can tell there is nothing of that sort, only things that say you should, you can, you may, but nothing that says this is required.
