Parents travelled away from their Main Home for a year, Son who lives in a different state, and Parents, engaged a Realtor who presented potential Rental Applicants. After appropriate credit screening, a local family was selected and the Realtor was paid their commission (1 month of rent if I recall correctly). Indeed, Fair Rent was Paid, documentation exists.
I have no concerns about that accounting, it was all proper and well executed, good real estate management company. Parents returned to Main Home after the 1 year lease to the Renters was up. Parents continued to live in this, their Main Home till one parent passed away in 2023. Subsequently, Home was Sold in 2024.
I have great feedback from others on this forum regarding how to calculate Basis and how to handle Depreciation Recapture (for Rental and Business Use) between Son and Parents i.e. the 3 purchasers of home in 1999.
Really the question is about Rental Depreciation Recapture. For whatever reason, the tax forms from 2006 and 2007 (the 12 months during which it was rented) claimed 0 for Rental Depreciation. I am trying to understand why this would have happened, did I make a mistake when navigating Turbo Tax Online back then or did it disallow the depreciation deductions for some other reason based on my tax info at that time.
The reason I am quibbling about 12 months of rental depreciation recapture is that I read in forums that I have to Recapture this Rental Depreciation regardless of whether it was actually claimed in the past. As long as "it could have been claimed" it should be recaptured.
Any help to put this issue to bed, in a fair way would be greatly appreciated. (i.e. I didn't deduct the depreciation for whatever reason, is there a proper remedy to fix it now so that I am not forced to recapture depreciation that "I could have claimed")
Thank You!!
