Form 4562 for New Rental Property

[Maypo 1975]

I was gifted my fathers home and after he passed away, I turned it into rental property.  Where do I input the basis for the property and how do I get it to calculate 4562 depreciation?

[DianeW777]

The basis of the gifted rental property is the same as the cost you father paid since it was gifted to you before his death. This answer assumes it was put into just your name at the time of the gift and before your father's death.

To add a house for depreciation in your rental activity you should select the following:

• TurboTax Online: Select 'Add expenses or asset' > when you are back to the rental information screen select to edit or add the asset.
• TurboTax Online: Select 'Assets' in your rental property
  • Enter the rental information requested and select 'Residential Rental Property' as the type.
  • Be sure to have the land portion of the cost to enter it when asked. Enter the full amount of cost for the rental home. TurboTax will calculate depreciation on the difference.
• You can use the tax assessment from the city or county to arrive at the percentage for land cost.
• Once the asset(s) are entered you will have a depreciation amount.  The chart below will show you how it's calculated and it can also be found in IRS Publication 946.

NOTE: If by chance you did inherit the home and it was not transferred to your name until after death the cost basis can be the fair market value (FMV) on the date of death. 

We are sorry for your loss.