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jrspada25
New Member

Should I depreciate a rental property that I plan on moving back into in a few years?

I converted our primary residents into a rental property while I am deployed. I plan to move back into the property in a few years. Should I start depreciating the rental property if only plan to rent it for a few years?
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AnnetteB
Intuit Alumni

Should I depreciate a rental property that I plan on moving back into in a few years?

Without going into too many details, if you converted the property to a rental, then you will have business use of the property.  Down the road when it is sold, even if you are living in the home again and no longer renting it, the fact that it was used for business purposes will require you to recapture depreciation “allowed or allowable”.  So even if you choose not to depreciate it, you will be required to take depreciation into account when it is sold.

For that reason, claiming the depreciation during the time the house is a rental may be your best option.


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1 Reply
AnnetteB
Intuit Alumni

Should I depreciate a rental property that I plan on moving back into in a few years?

Without going into too many details, if you converted the property to a rental, then you will have business use of the property.  Down the road when it is sold, even if you are living in the home again and no longer renting it, the fact that it was used for business purposes will require you to recapture depreciation “allowed or allowable”.  So even if you choose not to depreciate it, you will be required to take depreciation into account when it is sold.

For that reason, claiming the depreciation during the time the house is a rental may be your best option.


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