Discussion:BUSINESS USE OF HOME
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Discussion Forum Index --> Tax Questions --> BUSINESS USE OF HOME
RON CARMARK (talk|edits) said: | 27 October 2006 |
SOMEONE USED A RESIDENCE AS A RENTAL PROPERTY AND DEPRECIATED APPROXIMATELY 25% OVER THE YEARS. SUBSEQUENTLY, THE TAXPAYER USED IT AS A PRINCIPAL RESIDENCE AFTER DIVORCING AND BEGAN RUNNING A HOME OFFICE BUSINESS OUT OF IT. THE HOME OFFICE TAKES UP APPROXIMATELY 22% OF THE RESIDENCE. SINCE 25% OF THE RESIDENCE HAS ALREADY BEEN DEPRECIATED BEFORE IT WAS TURNED INTO A PRINCIPAL RESIDENCE HOW WOULD I DEPRECIATE THE BALANCE? 22% OF THE 75% NONDEPRECIATED BALANCE?
THANKS TO EVERYONE IN ADVANCE | |
| 27 October 2006 | |
| Depreciation is a seperate issue for each application. The recovery period for the rental portion is most likely different than for the office in the home. You should arive at the adjusted basis of the property for office in the home purposes (Cost minus prior rental depreciation) and begin depreciation from the date placed in service as office in the home. Use current recovery period and method. | |
Michaelstar (talk|edits) said: | 27 October 2006 |
| Agree with Taxnfp's method. | |
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