Yes, the suite will be the residential rental asset, depreciated over 27.5 years. The cost will be the capital improvements to create the suite and a portion of the original cost of the entire home.
- Calculate the cost of your home minus the land portion. Take the square feet of the suite and divide that by the total square feet of the home.
- Add the original cost of the suite/basement portion of the home to the improvements made specifically to the suite.
- This will be the cost basis used to depreciate the suite.
No, you will not find a form when you enter the expenses. The expenses are simply entered as an expense instead of an asset, as explained above, and placed here for convenience. They will be entered as an expense with the description noted. It's up to you to keep a list to track the expense later.
- Rental Property select Edit > Other expenses > Other Miscellaneous Expenses
- Enter Description (Safe Harbor ...) and amount (not entered as assets under this election)
@Teymietush
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