I am selling a condo that I lived in from 2008 to 2013, and rented out to tenants from 2013 to 2019.
As you might expect, the value of the property fell significantly from 2008 (pre-crash purchase at $200K) to 2013. As such, when starting to use the property as a rental, I was concerned about overstating the basis and claiming too much depreciation. I used the appraised value of the property at that time ($150K) from a recent refi as a basis and starting point for depreciation. I'm not sure if this was correct or not, but I was trying to play it safe.
Now when selling the property and calculating basis for gain/loss, is it appropriate to go back to the original 2008 purchase price, or to stick with the basis that I used for the business (from 2013-2019) and the associated depreciation?
Thanks for your thoughts. Numbers mentioned above are approximations for discussion.
