@baaadknight ,
1. It is not FMV or taxable value that you use --- it is your basis value less the value of the land under the property ( you can get that from the assessor's office ). The basis value is Cost of acquisition plus cost of any improvements. It may or may not eh FMV at the time of starting rent.
2. On how to share the depreciation between owners , the most usual way is to take all the earnings , expenses , depreciation etc associated with this rental and divide by percentage ownership or any other agreed ratio ( allocation ) and then each owner reports that on his/her return to the IRS. Generally it is best to look upon the share asset as a whole unit not multiple units ( to satisfy the multiple ownership ).. This also makes it easier for IRS to see the logic followed in case of an audit ( very unlikely but possible ).
Is there more I can do for you?
