Calculating cost basis of home converted to rental property

[ssanto]

I know that I am supposed to use the lesser of the FMV on the date of conversion or the purchase price plus improvements.  

FMV on date of conversion

290,000 - 2018 property tax assessor value

(65,000) - Land value

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225,000 - Improvement value

... so the FMV on date of conversion would be 225,000 because you can't include land value, right?

Purchase price plus improvements

205,000 - 2008 Purchase price

35,000 - Upgrades and improvements

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240,000 - Total value

... but for this method, how much do I deduct for the land value, is it going to be the land value from the 2018 tax assesment?

240,000 - Total value

(65,000) - Land value from 2018 tax assessor 

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165,000 - Home value used for rental property depreciation

Is that right, can I only use 165,000 as the home vale for the depreciation?  That feels awfully low :(

[Anonymous_]

Duplicate post