Investors & landlords

@DianeW777 

@RobertB4444 

Good morning Diane,

Thank you for those detailed comments.  I do have a few follow-up questions:

Loan Fees:

1. For any basis associated with depreciable items such as loan fees from the relinquished properties, can I track them as a separate depreciable asset for each replacement property?  For my own sanity, I think it will be easier to track/maintain.  Of course, for the oil and mineral rights properties, the portion of the loan fees that I assign to each of them will be tracked outside of TurboTax.
2. For those loan fees, is it correct that the depreciation schedule will be the same as the replacement property's depreciation schedule used for both the original basis and the additional basis - e.g., 39 years for commercial property?

Convenience Store/ Fuel Center - Changing depreciation schedule:

I tried to follow your steps that you outlined, and then made a few guesses on some sections/questions that you did not mention.  I must have done something wrong, as the depreciation amount went from $1000 (using a 39 year depreciation schedule) to about $0.  Some items I guessed on include:  1) chose 15 years for the Recovery Period, 2) chose 15 years for Asset class, 3) for MCARS Convention, the outcome didn't change whether I picked Mid-quarter convention or Half-year convention.  I believe the correct answer is Mid-quarter convention because I owned the property for less than 3 months of 2023 (actually owned it for only a few days of 2023).   I did not know if I needed to do anything in regards to the "Special Depreciation Allowance" section.  Any  thoughts here?  It might be easier to just use the standard 39 year schedule as a commercial property.  At least that gives me a depreciation amount to deduct.

(Totally new question)

Partnership LLC:

I was a member of an partnership LLC in 2023 in which we worked with a builder to build and sell a spec house.  The house was sold in 2023.  While I live in California, the LLC was established in Colorado, as the spec house was built in Colorado.  The forms I received from the LLC's CPA were a Colorado K-1 and a Colorado Nonresident Partner or Shareholder Agreement form.   On the K-1 form, only item 7 "Net capital gain" was populated with my portion of the proceeds made from the sale of the home.  No other line items were populated.  My questions are as follows:

1. Would the capital gain on the sale of a spec house typically be considered a "short-term" or "long-term" gain?  The LLC owned the lot and had the construction loan for greater than 1 year.
2. In TurboTax, under the "Choose Type of Activity" section, box 7 equates to Royalties, which does not seem suitable.  Instead, box 8 (short-term gain) or box 9a (long-term gain) seems like a better fit.  Please advise.
3. In TurboTax, I do not plan on populating anything for the "Percentage of Your Share" section or "Liability Share" section, as it says this is not necessary.  Is that ok?
4. Is it ok not to populate the Capital Account Information?  Nothing was specified on the K-1.
5. Under the first "Describe Partnership" section (includes checkboxes for items such as "publicly traded partnership", "partnership ended in 2023", etc), can I choose the "None of these apply" checkbox?
6. Under the second "Describe Partnership" section, would I choose "All of my investment in this activity is at risk"?  There was no guaranteed buyer for the spec house.

Your thoughts on any of those comments/questions would be so greatly appreciated!

Thanks so much!

Jamie