We have a home that we purchased and resided in, while on active duty orders, using a VA-financed loan. The funding fee was rolled into the loan amount, so my mortgage paperwork includes that in the loan amount.
We also refinanced several years ago, during the big interest rate dip after c-d, so we have a new loan amount.
Since moving forward into Veteran/civilian life, we have moved and purchased a new home, keeping the old home as a rental this past year. (Yes, we lived in the home plenty long enough to convert it, even after refinancing).
We are not trying to figure out our landlord taxes and cannot seem to find the answer to this question: which amount do we start with for the cost basis to calculate depreciation??
- Again, the home was purchased with the funding fee rolled in, so the loan amount reflects that.
- It was refinanced (with a new funding fee), so the new loan amount is different.
- Renovations were done (flooring, kitchen remodel, roof), so those will be included.
- The land is not depreciable, so that will have to be figured out too—though our county does NOT have any records for assessment of the home or land, so I'm not sure which ratio to use to calculate this, …or if we include the loan amount or somehow figure out the loan amount minus VA funding fee (so I guess that's a second question).
Which amount do I start with, and which do I use for calculating the land, and which (if you want to answer that bonus question) ratio would I use to calculate the amount allocated to land if the county has no information for this?
Thank you!
