I am in similar situation as Captpaco70. Spouse died on 9/2/22. Rental property was owned by spouse and me as community property prior to spouse's death.
For 2022, should I do the following:
1. From 1/1/22 - 9/1/22, I continue to report rental income and expenses as prior years, using the old property basis for depreciation. I retire the property on 9/2/22.
2. 9/2/22 - 12/31/22, I start the same property as a new property, using the same address, with a stepped up basis as of 9/2/22. New depreciation on the stepped up basis starts on 9/2/22.
3. The property is not a sale, and there is no recapture of prior depreciation.
I own more than one rental property. I would repeat the two steps (1 and 2) for each property.
Thank you for helping me out 🙂
