Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
texzen5
Level 2

I think I've made a significant rental home depreciation mistake

I'd appreciate a sanity check.

 

I own a rental home outright and am preparing to sell it. I've depreciated the $151,500 improvement by the formula (divided by 27.5) for 16 years.  In total, I've depreciated it about 88K.  I never altered my depreciation amount (a steady $5509 per year), even as the improvement rose to a county appraisal value of 332,000. 

 

When I sell my home, will taxing authorities assert the more aggressive depreciation reduction that I should have taken?  Or will they honor my depreciation over the years?  I know I've left money on the table over the years not depreciating more aggressively, but I'm hoping I haven't created a huge sale headache and can see benefit on the sale side. 

 

Thanks for your clarification and help. 

1 Best answer

Accepted Solutions
Mike9241
Level 15

I think I've made a significant rental home depreciation mistake

depreciation is based on your cost/tax basis, not what it's appraised at by taxing authorities.  your depreciation is computed correctly for income tax purposes.   

View solution in original post

1 Reply
Mike9241
Level 15

I think I've made a significant rental home depreciation mistake

depreciation is based on your cost/tax basis, not what it's appraised at by taxing authorities.  your depreciation is computed correctly for income tax purposes.   

View solution in original post

Dynamic AdsDynamic Ads
Privacy Settings
v