Cost basis

Forum|Forum|2 years ago
March 11, 2024
1 reply
0 views

Which is use, cost basis(original cost of property, in this case a rental) or adjusted cost basis to get depreciation expense.

Vanessa A

Your original building depreciation will be the original cost of your property.

As you make improvements, you will separately depreciate the items. For instance, if you add redo or put in new sidewalks to your property, you would depreciate them over their 15 year useful life. You would not add the side walk to the original cost for purposes of depreciation.

Each improvement is its own asset.

Be sure to track each items depreciation, so when it comes time to sell the property, you will end up listing each item as sold.

Pub 946 How to Depreciate Property

Tax Deductions for Rental Property Depreciation

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"