Can i deduct rental property depreciation if i have a high income?

[DavidS127]

You should report your rental property depreciation regardless of your income.  In fact, the IRS rules require you to do so.

But, if you have a loss on the rental, your income level may impact whether the loss is deductible in the current year.

Generally, rental losses are "passive losses" that can only be used to offset "passive income".  But, the IRS permits a "special allowance" to deduct up to $25,000 of these passive losses in a year, even if you don't have passive income.

But, that "special allowance" is reduced once your "modified adjusted gross income" (MAGI) exceeds $100,000, and is completely "wiped out" if your MAGI exceeds $150,000.

See this section of IRS Publication 925 for more details on the phaseout of the $25,000 special allo....

Note that the losses you can't deduct currently will be deductible in the year you dispose of the rental property, regardless of your total income or your passive income.