I inherited a townhome rental property from my father in 2022. I have an appraisal that establishes the fair market value of townhome at $375K at time of death. The property appraiser in my county has the land valued at $145K and building valued at $126.5K for a total market value of $271.5K for tax year 2022. I am entering the rental property on my 2022 tax return at inherited rental property under wages & income section. I used the $375K appraised value for the fair market value including land. The section in Turbo Tax where you enter the land value includes following instructions:
"Use the values listed on your property tax bill to find this information. Your property tax bill may not show reliable assessed values if you've recently purchased a newly built house or made improvements to the property. If your assessed values don't reflect the full value of improvements to your property, you can still used the assessed land value. "
I did not make any improvements to the townhome in 2022. My property tax bill does not show breakout between land and building so I called the property appraiser office to get the breakdown. My question is do I use the $145K assessed value for land in Turbo Tax which appears to be in sync with instructions listed in the Turbo Tax software? Or do I need to use the percentage of land value and apply that percentage to my appraisal value to calculate the amount I enter in Turbo Tax for the land value (in this case 53% x $375 = $198,750)?
