Structure Previously Depreciated via Deminimus Safe Harbor can be used in home cost basis

[maps4you]

We replaced a support structure in the rear of our rental home to house pool equipment.  The entire house was rented and the structure was depreciated via de minimus safe harbor one time depreciation in 2017.  The house sold in 2019 and I was wondering if that same structure can be use in the home cost basis computation.

[Carl]

When you sell rental property, you *MUST* recapture *all* prior depreciation regardless of how you claimed that depreciation, and pay taxes on it in the year of the sale. Basically, the depreciation taken reduces your cost-basis in the property, thus making more of your gain taxable.

The recaptured depreciation will be taxed at a minimum of 0% and a maximum of 25%. The program will deal with it just fine.

[Anonymous_ · Accepted solution]

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@maps4you wrote:

....I was wondering if that same structure can be use in the home cost basis computation.

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You actually have no basis in the structure; you have a zero basis because you essentially wrote off the entire cost of the structure when you used the de minimus safe harbor provision. Clearly, therefore, the basis of the home cannot be increased by the cost of that structure.