AmyC
Expert Alumni

Investors & landlords

You can do the math or let Turbo Tax do the math. If you want Turbo Tax to do the math, say it was part personal and part rental. If you want to do the math, say it was 100% rental and input the number of days rented, etc.

The cost used for a rental that you have lived in is the lower of fair market value or your basis. So, if you bought the house for $100k and did $30k in improvements, $130k is what you have into it. The market took off and the FMV is $400k. Your basis for the rental is the lower, $130k. Use your best judgement. Grab a paper, a pen, a spouse, and stroll down memory lane thinking of what improvements you have made. 

 

If the IRS decides to audit you, you can dig up old pictures, neighbors, etc to help verify what you remembered. CPA or you, the answer is the same, a stroll down memory lane is the best you can do. Enjoy it!

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"