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Question

Converting business property to personal property

Forum|Forum|4 years ago
April 18, 2022
1 reply
0 views

If I have a home as a short term rental business (Sched C) and convert to personal primary residence do I have to pay depreciation back after conversion or only when I sell?

Employee

You are required to recapture depreciation in the tax year you sell the property. So after you convert the property and all listed assets to personal use, you will need to print both of the 4562's for that business, that print in landscape format and keep them for as long as you retain ownership of the property. You will need those forms when one of 3 things occurs in your future.

1) You convert the property back to any type of business use.

2) You sell the property

3) You die.