"As you are only renting one room, you have to calculate the rental percentage (for example by dividing the rented area by the total area of your home). Then multiply the cost basis of your home by the rental percentage to arrive at the cost basis of the rented area, which is used for depreciation."
Let me make sure I understand the first part though. You are saying to add together all the improvements to the purchase price (minus land) as one asset entry with the same date of purchase, and then the date placed in service?
I understand the two calculations, just not how to enter it properly in Turbo Tax (desktop version)
I have 20% of home used for business (square footage percentage) and about 120 rental days of 180 available (40%)
I entered that I don't rent 100% of the time, and I've entered personal use days versus rental days.
For the asset entry, I used the the 20% entry for time used as I've seen that suggested here. My depreciation report is showing that it is using the 20% for the cost basis, but is ignoring the percentage of use for depreciation. Should I be entering the info differently?
I will have the same rental percentage next year, but the percentage of time will vary each year, so I want to enter it right the first time.
thanks!
