You can decrease the value of the land without affecting the depreciation on the structure. Just work through the asset.
Reduce the cost of the land in the COST OF LAND box, by the percentage of the land that was sold. Then reduce the amount in the COST box by the same exact amount. Then you'll report the sale in the investments section.
Example.
COST: $200,000
COST OF LAND $50,000
The program (not you) figures the depreciable value of the structure at $150,000
Say you sold 10% of the land. Ten percent of $50,000 is $5000. So reduce the land cost by that much and the total cost by the same amount.
COST: $195,000
COST OF LAND: $45,000
Simple math shows the value of the structure is unchanged at $150,000
If you sold the land for $10,000, then when you report the sale in the investments section you'll have a cost basis of $5000, which will give you a $5,000 taxable gain.
