Rental Tax Deduction Question

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DCal430

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Feb 12, 2011
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A home was purchase around 6 years ago, for 450,000, with the structure having a value of about 200,000. Shortly after it was used as a rental property for 3 years. During this time 3 years worth of depreciation was taken on the home. After 3 years rental the home had approximately 50,000 worth of improvements made on it, however after the improvements it was no longer used as rental property, but instead as a second resident and investment home. Fast forward now, and a few thousand in repairs and improvements were made to get the home ready to be rented again.

When the home begins renting again, do you continue deducting the 200,000 structure from where you left off? What about the 50,000 in improvements, and the recent few thousand in repairs and improvements to get it ready for renting?

Thanks for the answers.

There's a tax thread in OT. Please post in it. http://forums.anandtech.com/showthread.php?t=2361895&highlight=tax
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Xcobra

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Oct 19, 2004
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You can add up the improvements made after it was used as a rental. Substantial improvements can be capitalized and depreciated. Repairs prior to it being available for rent technically do not count (as it was not ready to be rented). Just have to keep in mind what you have deducted as depreciation in the past. Just add a second entry in the software as "improvements" and include the value and when it was available for rent.
 
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