Harlan Lunsford <hnslunsford[at]bellsouth.net> wrote:
- quote -

If you go take a look at section 179, and then 1245, it's
actually pretty complicated. For the most part it's not
allowed, but it looks like there may be some exceptions.

Stu

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krasi wrote:
- quote -

Doesn't matter. It's still not allowed.

ChEAr$,
Harlan Lunsford, EA n LA

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Rich Carreiro wrote:
- quote -

LOLROF!

Rich, you fell into my trap.

(bigger grin, now)

Of course I never commented on what one can or cannot do,
but only IF he did it.

ChEAr$,
Harlan Lunsford, EA n LA

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"Rich Carreiro" <rlcarr[at]animato.arlington.ma.us> wrote:
- quote -

I should have been clearer. It is commercial property.

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"Dick Adams" <rdadams[at]smart.net> wrote:

- quote -

This is great. No, I did not pay since the "advisor" seemed
hesitant when I asked for explanation. I only did so
because it sounded too good. So, I know now that I have to
have the tenant in-place. ... Thanks a lot!

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krasi" <krasi[at]varna.com> wrote:
- quote -

AC is generally treated as a part of the building and
depreciable over 27.5 years (residential) or 39 years
(commercial). The exceptions are when special/additional
cooling is required for a specific reason (e.g. in a grocery
frozen food section). But since you didn't have a tenant in
2006 that shouldn't apply.

--
Drew Edmundson, CPA
Cary, NC

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Harlan Lunsford <hnslunsford[at]bellsouth.net> writes:

- quote -

I believe the section 179 election is not allowed for
residential real estate.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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"Rich Carreiro" <rlcarr[at]animato.arlington.ma.us> wrote:
- quote -

Equipment such as AC etc.

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"krasi" <krasi[at]varna.com> writes:

- quote -

I hope you didn't pay for that advice. The general rule
is: Real estate expenses must be added back into the basis,
(capitalized). Repairs are one of the exceptions and they
are subject to a variety of rules.

Depreciaton can only be taken while the property is in
service (producing income as in the tenant has moved in).

Dick

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"Seth Breidbart" <sethb[at]panix.com> wrote:

- quote -

That is pretty much the situation.

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Rich Carreiro wrote:
- quote -

Not if you use section 179 for the property. (big grin!)

ChEAr$,
Harlan Lunsford, EA n LA

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- quote -

If it's commercial space, it might have been ready to be
rented, with the tenant responsible for setting up the
inside however he wants (or perhaps the landlord doing that
after the lease is signed).

Seth

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"krasi" <k...[at]varna.com> wrote:

- quote -

Depreciation begins when the property is placed in service.
Rental real estate is placed in service when it is available
to be rented. If the property was not yet ready to be rented
on Decemer 31, 2006 then there is no depreciation deduction
for 2006.

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krasi" <krasi[at]varna.com> wrote:

- quote -

If you have invested so much money in this investment that
you would be entitled to a depreciation deduction of
$108,000, you certainly should be able to afford
professional help with your taxes. In fact, I would think
you really NEED professional help.

To answer your question, though, you start taking
depreciation when you place the asset in service. Since the
building is not complete and you cannot have a tenant, you
have not placed the building in service. So, you would not
be entitled to depreciation in 2006.

Lanny K. Williams, CPA
Nawarat, Williams & Co., Ltd.
Income Tax Services for Expatriate Americans

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"krasi" <krasi[at]varna.com> writes:

- quote -

How did you come up with that $108,000? Seems awfully high
for a single-unit property.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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I have a new real estate investment which was completed from
outside in 2006 and the inside is not done yet till a tenant
moves in. I understand that I can take a depreciation
allownace of $108,000 for the first year. Will the first
year be when the building is completed from inside or rented
etc. or should I take it in 2006?

Thanks.

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