This is absolutely no different than if the FMV of the property at the time it was placed in service, was less than the original purchase price. It's how you can significantly reduce your chances of an audit while still reporting the sale with the correct information and only paying taxes on what you should be taxed on.
Besides, the other way (that may increase chances of an audit) is to add the $10K difference to the value of the land and leave the value of the structure alone. That makes all prior as well as the current year's depreciation alone.
You go changing the structure value on the SCH E and that's basically screaming for an audit, whereas increasing the land value only is yelling softly for an audit. Reporting it my way in "Sale of Business Property" doesn't even so much as raise an eyebrow. But "if" audited (and I doubt that would happen) they have the paperwork to prove their cost basis.
