PatriciaV
Expert Alumni

Investors & landlords

No, you should report depreciation expense only for the period that the asset was considered a rental property.

In addition to reporting the number of days it was rented, you also need to reduce the percentage business use for the asset itself. This appears during the interview under Sale of Property/Depreciation. Click "Edit" beside the property you wish to change and continue until you see the page titled "Tell Us About This Rental Asset."

At the bottom of the page, indicate that you have not always used the asset 100% (see screenshot below - click to enlarge). This will open a drop-down where you can change the percentage business use. This would be the number of days or months the property was rented or available to be rented as a percentage of the total year (days or months).

After you change this value, check to be sure the depreciation expense is correctly allocated.

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