Sale of rental property- should we allocate structure sales proceeds or entire house sales proceeds to depreciated asset sales prices?

[manbeing]

Please let  me know which sales proceeds should be used for depreciated asset allocations? $100K?  or $80K?

House sales proceeds - $100K

structure sales proceeds - $80K

land sales proceeds - 20K ($100K-$80K)

[MichaelL1 · Accepted solution]

You should allocate the proceeds to what was sold, which is land , the structure, and then possibly any recent improvements made that are being depreciated on the return.

Make sure all assets listed on the depreciation schedule are accounted for, as this is what removes them from the schedule.

[manbeing]

Thanks for the reply. Should I keep the land proceeds as is ($20K) and allocate structure proceeds (80K) to depreciated assets? for example,    10K (total depreciated assets sales price) + $structure proceeds (70K) + land proceeds (20K) = 100K

[MichaelL1]

I would add it to structural asset as that is what was damaged (and is what the assessment was for)--plus you can depreciate it.