CBres77376 wrote:

- quote -

Thanks, David. The property actually contains rental
buildings on an island, depreciated on a 31.5 year schedule,
purchased in the late 80's. A dock was added about 1.5 years
later and then some dock improvements were done the year
after that. The dock and its improvements were placed on a
20-year depreciation schedule.

Thanks for your help.

Lois

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The improvements are part of the cost of the building. They
are added to its basis and figured in for the % of what is
the land sale price and what is the building;no sale price
zero.The cost of sale are also allocated by the same % to
land and building basis. 20 year depreciation?I remeber in
the earlier years of macrs improvements did not neccasarily
go over the life of the building but 20 years does not ring
any bells as a class life ;if amt is affected you may have
to break out the cost of improvements and the % of the sale
price allocated to them and treat it as a seperate sale.

David Breslin,E.A.

Sorry forgot. Remaining points are fully deductible in the
year of sale.

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lois[at]nospam[at]prodigy.net (Lois) posted:

- quote -

Two Pubs should combine to cover your questions: Pub 527 -
Residential Rental Property and Pub 544 - Sales and Other
Disposition of Assets.

Bill

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I have some questions regarding the reporting of some
aspects of the sale of rental property.

Rental property consisting of land and buildings was sold.
It was acquired in 1987 - building was being depreciated on
a 31.5 year schedule.

Improvements were added in the next couple of years that are
being depreciated on a 20 year schedule. Refi points are
also being amortized over a 27.5 year period.

On the 4797, it seems to make sense to allocate the sales
price to the original building and land (based on a %
allocation), but how are the other depreciable
improvements/points handled in the year of disposition?
Should those additional items also be proportionately
included in the allocation of the gross sales price or can
they be sold for $0?

If someone can point me to the correct pub for handling
these extra items, I'd be most grateful.

Lois

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