Cost Basis for Rental Property when renting out a part of home

[vinodr777]

I rent out 2/3 of my home.

In the expense part of the rental income section, I put the percentage that was used for rental as 0.67 and let Turbo Tax do the math in regards to the portion that would get applied to offset rental income.

However, I want to make sure I am doing the Property Depreciation section part of the rental income correctly.

There, to calculate my cost basis, I did the calculation myself of 2/3 the total cost I paid and entered the result in. I did the same for the land value input.

And for Busines Use percentage, I put 100% because I interpreted this to mean that rental portion of the property was used 100% of the time for business (in my case).

Have I interpreted and done this correctly in TurboTax? Or am I supposed to calculate and enter property depreciation information differently when I rent out a part of the home?

[KurtL1]

When you enter the cost of your home and the cost of the land enter only the business percentage of the costs.

Then say you used it 100%. This represents the percentage of days in the year you rented the property. If you rented from 01/01/19 through 12/31/19 you were at 100%.

On the Asset Summary screen there is a block to look at the detail on the depreciation. It should show the 2/3 cost on the home and the land. I should show you used the business portion 100 of the time during the year.

[x_m_z]

I have the same question and I would appreciate further help:

When I called TurboTax support last week, a TurboTax expert did not ask me to change the total cost of the house and total cost of the land, but she asked me to enter 45% for percentage of business since I only rented 45% of my house.

[AnnetteB6]

Mathematically, both approaches will work and give correct calculations on your tax return.  However, entering the percent business use as 45% (for example) while entering 100% of the cost of the property and land will give you the most flexibility for the future if your rental percentage changes to something other than 45%. 

I would recommend keeping the flexibility by entering the percent business use while entering 100% of the cost.

@ x_m_z