A building used for business purposes is a capital asset and is depreciated
over it's useful life. The costs of construction are not a deduction,
they are the cost basis for depreciation. Depreciation begins when the
asset is entered into service.
When Does Depreciation Begin and End?
You begin to depreciate your property when you place it in
service for use in your trade or business or for the production of
income. You stop depreciating property either when you have fully
recovered your cost or other basis or when you retire it from service,
whichever happens first.
You place property in service
when it is ready and available for a specific use, whether in a business
activity, an income-producing activity, a tax-exempt activity, or a
personal activity. Even if you are not using the property, it is in
service when it is ready and available for its specific use.
Please see the following: http://www.irs.gov/publications/p946/ch01.html#en_US_2013_publink1000107308
A capital asset is an asset that benefits your business for more than
one year. Most businesses will need capital assets such as equipment, a
car, computer and office furniture. Capital assets must be depreciated
and cannot be treated as an expense in the year they are acquired or put
into service.
To enter your capital asset (Real Estate Property) into TurboTax, go to the Business Assets section, which is located under Business Income and Expenses. Screen image attached.
