Alan wrote:

- quote -

Ah great! You don't have any problem for tax year 2004.
It's not a factor.

However starting this year, you add all the costs together
and then depreciate over 27.5 years. Don't forget however,
and this is a biggie, to subtract the value of the land
from the whole property. Land just ain't depreciable.

ChEAr$,
Harlan Lunsford, EA n LA
24 Mar 2005

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Bought a rental property in 2004 for $229,000.
Spent $32,000 in improvements - not repairs.

In filling out Schedule E, should I show the basis as
$261,000 or do I need to break out the improvements on a
separate line? Problem is, I don't know where that line
is!

Using Taxcut and it will allow me to show a second item
under Rental Properties and put in the $32K labeled as
improvements but doesn't depreciate it.

Help! (and thanks.)

(By the way, didn't start getting rental income until 2005.)

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