Land is 95,000 and does not depreciate.
Building is 405,000 depreciated over 27.5 is 14,727 per year.
14,727 will be a depreciation expense each and every year.
Depreciation, as well as other expenses, will lower your rental income.
Any new assets added, such as appliances, are depreciated separately.
All the 14,727 is applied every year, the question is- if the rental results in a loss, is the entire loss claimed or is it limited.
Passive loss allowed is based on your participation and income levels.
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