Rental Property - 3 owners

Forum|Forum|3 years ago
April 17, 2023
1 reply
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I have a situation with an inherited rental property - my husband & his 2 sisters...so my husband has 33.33% ownership. If I choose the option to have TT calculate the rental income & expenses, TT is automatically taking 1/3 of the figures and putting the reduced figures in the system for me, BUT do I have to manually enter 1/3 of the fair market value of the property as well as 1/3 of the land value & 1/3 of the building value? TT did not make those calculations. So, I am now questioning whether I should even be dividing the totals by 3 or if I should leave the full FMV & land/building totals as is.

I would assume that if the fair market value, land value & beuilding value were supposed to be divided by 3, then TT would have done it. What should I do?

TurboTax Live Premier Online

Carl11_2

Employee

do I have to manually enter 1/3 of the fair market value of the property as well as 1/3 of the land value & 1/3 of the building value?

Yes. But the program does not ask you for a separate structure value. It only asks for total cost in the COST box, where you will enter 1/3 of value of the entire property, and COST OF LAND where you will enter 1/3 of the land value. Then the program (not you) will subtract COST OF LAND from COST to figure the structure value to be depreciated.

Rara26Author

Hi. Thanks for responding. I am using TT online and it does, in fact, separate it out with (1) land cost and (2) building cost. So my question is do I put in the full cost of both from figures I got from the property taxe bill or do I put one third of those figures for each.

Also do I put in the full fair market value or only 1/3. Thanks.

AnnetteB6

If you entered that you only owned 33% of the property and you are entering 100% of the income and expenses, then TurboTax is applying the 33% to both the income and expenses.

On that same page where you entered the ownership percentage, there is a note telling you that you will need to enter the cost basis of the home to represent your ownership percentage. TurboTax does not make that calculation for you.

Therefore, on all of the questions related to the cost of the home, cost of the land, and the fair market value, you will need to enter one third of the total since you have 1/3 ownership in the property.

@Rara26

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