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March 22, 2025
Question

How do I add major improvement items to the cost basis of rental property sold?

  • March 22, 2025
  • 1 reply
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I have owned the property for 28 years. Where do I add major costs (remodel, roof, etc.) to the cost basis?

    1 reply

    KrisD15
    March 22, 2025

    Major improvements, such as a roof, are added as separate additional assets to the rental. 

    They are then depreciated on their own.

    When you sell, you allocate the sales proceeds to all remaining assets. 

     

    In TurboTax, go to the rental section

    Review your rental summary 

    Select Edit for the rental property 

    Scroll down to Assets/Depreciation 

    Select "Add an Asset" 

     

    IRS Pub 527 

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