- quote -

Basically, there's no generally reasonable estimate.

In some places, the land is worth 105% of the total (people
buy houses to knock them down and build new houses, so the
land is worth the total plus the cost of knocking down the
old house).

Seth

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"R. Pile" <michael.br...[at]wdn.com> wrote:

- quote -

1. His basis in 2006 is his original basis on his portion of
the property reduced by his allowable depreciation from
1981-2006 plus the 1995 FMV of the portion inherited reduced
by his allowable depreciation on that portion from
1995-2006.

2. I have heard an 80% house 20%land is sometimes used.

3. Don't know

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This question involves a rental property purchased by
brother and sister in 1981. Brother (my client) filed MFJ
with his wife, claiming his half of depreciation expenses;
sister filed her own tax return, claimimg her half of
depreciation expenses. Sister died in 1995 when house was
re-appraised. Brother inherited her half of rental property
and a stepped-up basis. Brother sold house in 2006.

1. Normally, for the capital gains computation, the basis is
reduced by depreciation "allowed or allowable." Now that
the house has been sold, does brother reduce the basis by
the total amount of depreciation claimed by both he and his
sister separately or just the amount of depreciation claimed
on his own tax returns from 1981-1995?

2. Without any other information, I am assuming the
depreciable (house) portion of the property is two-thirds of
the total, with the undepreciable land being the remaining
one-third. Is that a reasonable estimate?

3. In 1981, was this 15 year real property ACRS
depreciation?

Thank you.

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