@DianeW777
Good afternoon Diane,
I was afraid that you might say that.
Just to be fully grounded, to reiterate, based on your last comment, it seems like there is no argument that would be accepted by the IRS that would allow one to transfer any portion of the basis allocated to the Oil and Gas property to Properties 2 & 3 , either the original basis or the additional basis? This is despite the property being considered non-land mineral rights, and the fact that the asset/improvement portion of the exchange are the dollars that would be apportioned? ($90,000 of the original basis being associated to the structure and $112,000 of the additional basis before minor land apportioning, as the land is only 5% or less of the total cost of the property for properties 2 & 3)
I guess the other side of the argument is that one could say Oil and Gas/mineral rights has its own version of a depreciation deduction in terms of the 15% depletion.
In the future, if I exchange the Oil and Gas property for a like-kind property with an improvement that can be depreciated, can a portion of the $56,000 basis tied to the Oil and Gas property be used to depreciate the asset at that future property?
Thanks so much!
Jamie
