Discussion:Rehab of rental property
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Discussion Forum Index --> Advanced Tax Questions --> Rehab of rental property
Discussion Forum Index --> Tax Questions --> Rehab of rental property
Chicagocpa1 (talk|edits) said: | 10 April 2008 |
| Hello - I have client who took his rental property out of the rental market for a year to rehab it. It then went back on the rental market the following year. During the year it was being rehabbed, it is obviously not a schedule E and rehab costs would be added to basis. However, would it be considered investment property during rehab year? And non-rehab expenses being investment expense or would they be added to basis too? Would it require unrecaptured amounts being reported? Thanks. | |
| 10 April 2008 | |
| See Sec 263(a) - must capitalize all carrying costs - life 27.5 years (if residential).
Non rehad (indirect) go into the basis - See example of Guaranteed Payments to Partners were required to be capitalized. Your last statement confuses me, "would it requrie unrecaptured amount being reported"? what do you mean by that, please? | |
Chicagocpa1 (talk|edits) said: | 10 April 2008 |
| Thanks! The property was depreciated for several years. Now that it is not rental property and there is no depreciation do I need to report unrepactured amounts on schedule D. | |
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